MIRA INFORM REPORT

Report Date :

24.10.2008

IDENTIFICATION DETAILS

Name :	POLYPLASTICS ASIA PACIFIC SINGAPOREPTE. LTD.

Registered Office :	6 Temasek Boulevard #25-01 Suntec Tower 4 038986

Country :	Singapore

Financials (as on) :	31.12.2007

Date of Incorporation :	11.07.1997

Com. Reg. No.:	199704814G

Legal Form :	Pte Ltd

Line of Business :	General Building Engineering Services; Manufacturing and Sales of Engineering Plastics

RATING & COMMENTS

MIRA’s Rating :

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

POLYPLASTICS ASIA PACIFIC SINGAPOREPTE. LTD.

Line Of Business

GENERAL BUILDING ENGINEERING SERVICES;

MANUFACTURING AND SALES OF ENGINEERING PLASTICS

Parent Company

POLYPLASTICS CO, LTD

(PERCENTAGE OF SHAREHOLDINGS: 100.00)

Financial Elements

FY 2007

COMPANY

Sales : US$ 44,163,460

Networth : US$ 3,584,075

Paid-Up Capital : US$ 316,456

Net result : US$ 1,412,039

Net Margin(%) : 3.20

Return on Equity(%) : 39.40

Leverage Ratio : 3.27

COMPANY IDENTIFICATION

Subject Company :	POLYPLASTICS ASIA PACIFIC SINGAPOREPTE. LTD.
Business Address:	6 TEMASEK BOULEVARD #25-01 SUNTEC TOWER 4
Town:	SINGAPORE
Postcode:	038986
Country:	Singapore
Telephone:	6737 3693
Fax:	6737 7823
ROC Number:	199704814G

SUMMARY

Legal Form:	Pte Ltd
Date Inc.:	11/07/1997
Summary year :	31/12/2007
All amounts in this report are in :	USD
Sales:	44,163,460
Networth :	3,584,075
Capital:	-
Paid-Up Capital:	316,456
Employees:	16
Net result :	1,412,039
Share value:	1

AUDITOR : DELOITTE & TOUCHE LLP

BASED ON ACRA'S RECORD

                                               NO OF SHARES   CURRENCY              AMOUNT

ISSUED ORDINARY                500,000                   SGD                       500,000.00

PAID-UP ORDINARY                -                              SGD                        500,000.00

REFERENCES

Litigation:	No
Company status :	TRADING
Started :	11/07/1997

PRINCIPAL(S)

TOSHIFUMI NONAKA

G5866549K

Managing Director

DIRECTOR(S)

TAN CHENG SIEW @ NUR FARAH TAN	S6920790A	Company Secretary
Appointed on :	15/05/2000
Street :	97 BEDOK NORTH AVENUE 4 #20-1513
Town:	SINGAPORE
Postcode:	460097
Country:	Singapore
TOSHIFUMI NONAKA	G5866549K	Director
Appointed on :	09/04/2006
Street :	180A BENCOOLEN STREET #05-07 THE BENCOOLEN
Town:	SINGAPORE
Postcode:	189647
Country:	Singapore
YUJI TAKAHASHI	MQ2921516	Director
Appointed on :	01/04/2000
Street :	KANEHODA 4-11-7 KAWASAKI-CITY
Town:	KANAGAWA PREF
Country:	Japan
MINORU HIROSE	TF2500058	Director
Appointed on :	09/04/2006
Street :	PARK CITY MIZONOGUCHI C510 HISAMOTO 3-6-3, TAKATSU WARD KAWASAKI CITY
Town:	KANAGAWA PREFECTURE
Postcode:	213-0011
Country:	Japan
TOSHIFUMI NONAKA	G5866549K	Managing Director
Appointed on :	09/04/2006
Street :	180A BENCOOLEN STREET #05-07 THE BENCOOLEN
Town:	SINGAPORE
Postcode:	189647
Country:	Singapore

ACTIVITY(IES)

Activity Code:	16910	PLASTIC - ENGINEERING
Activity Code:	11760	IMPORTERS And EXPORTERS

BASED ON ACRA'S RECORD

1) GENERAL BUILDING ENGINEERING SERVICES;

   MANUFACTURING AND SALES OF ENGINEERING PLASTICS

2) GENERAL WHOLESALE TRADE (INCLUDING GENERAL IMPORTERS & EXPORTERS)

SHAREHOLDERS(S)

POLYPLASTICS CO, LTD

500,000

Company

Street :	13TH FLOOR JR SHINAGAWA EAST BLDG. 18-1, KONAN 2-CHOME MINATO-KU
Town:	TOKYO
Postcode:	108-8280
Country:	Japan

HOLDING COMPANY

POLYPLASTICS CO, LTD

UF21256K

100%

PAYMENT HISTORY AND EXPERIENCES

Trade Morality:	AVERAGE
Liquidity :	SUFFICIENT
Payments :	REGULAR
Trend :	LEVEL
Financial Situation:	AVERAGE

FINANCIAL ELEMENTS

Audit Qualification:	-	-
Date Account Lodged:	23/06/2008
Balance Sheet Date:	31/12/2007	31/12/2006
Number of weeks:	52	52
Consolidation Code:	COMPANY	COMPANY

--- ASSETS
Tangible Fixed Assets:	71,582	90,078
Investments	125,610	114,362
Total Fixed Assets:	197,192	204,440
Inventories:	2,178,419	2,542,150
Receivables:	9,136,262	8,327,855
Cash,Banks, Securitis:	3,622,082	3,484,246
Other current assets:	152,976	114,476
Total Current Assets:	15,089,739	14,468,727
TOTAL ASSETS:	15,286,931	14,673,167
--- LIABILITIES
Equity capital:	316,456	316,456
Profit & lost Account:	3,267,619	1,855,580
Total Equity:	3,584,075	2,172,036
Trade Creditors:	11,438,397	6,206,387
Provisions:	264,459	6,294,744
Total short term Liab.:	11,702,856	12,501,131
TOTAL LIABILITIES:	11,702,856	12,501,131
--- PROFIT & LOSS ACCOUNT
Net Sales	44,163,460	42,338,291
Gross Profit:	3,302,061	3,347,752
NET RESULT BEFORE TAX:	1,725,998	1,852,880
Tax :	313,959	365,403
Net income/loss year:	1,412,039	1,487,477
Purchases,Sces & Other Goods:	40,861,399	38,990,539

RATIOS

Date Account Lodged:	31/12/2007	31/12/2006
Turnover per employee:	2760216.25	2646143.19
Net result / Turnover(%):	0.03	0.04
Stock / Turnover(%):	0.05	0.06
Net Margin(%):	3.2	3.51
Return on Equity(%):	39.4	68.48
Return on Assets(%):	9.24	10.14
Net Working capital:	3386883	1967596
Cash Ratio:	0.31	0.28
Quick Ratio:	1.09	0.94
Current ratio:	1.29	1.16
Receivables Turnover:	74.47	70.81
Leverage Ratio:	3.27	5.76

^{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

NOTE: THE FINANCIAL STATEMENT IN THIS REPORT IS UNAUDITED AND    FINANCIAL ANALYSIS IS NOT CONDUCTED. THE FINANCIAL STATEMENT SERVES AS A REFERENCE ONLY. IN REPLACEMENT, ADVERSE CHECK ON ITS LOCAL DIRECTORS IS MADE.

BACKGROUND/OPERATION

THE COMPANY WAS INCORPORATED IN THE REPUBLIC OF SINGAPORE ON           11/07/1997 AS A LIMITED PRIVATE COMPANY AND IS TRADING UNDER ITS       PRESENT NAMESTYLE AS "POLYPLASTICS ASIA PACIFIC SINGAPORE PTE. LTD.".

THE COMPANY HAS AN ISSUED AND PAID-UP CAPITAL OF 500,000 SHARES, OF A VALUE OF S$500,000.

PRINCIPAL ACTIVITIES:

SUBJECT IS REGISTERED WITH THE ACCOUNTING AND CORPORATE REGULATORY

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

1) GENERAL BUILDING ENGINEERING SERVICES;

   MANUFACTURING AND SALES OF ENGINEERING PLASTICS

2) GENERAL WHOLESALE TRADE (INCLUDING GENERAL IMPORTERS & EXPORTERS)

THE COMPANY IS LISTED IN THE SINGAPORE LOCAL DIRECTORIES UNDER THE

CLASSIFICATION OF: PLASTICS - RAW MATERIALS-POWDERS/ LIQUIDS/ RESINS.

FROM THE RESEARCH DONE, THE FOLLOWING INFORMATION WAS GATHERED:

INFORMATION ON ITS HODLING COMPANY:

ACTIVITIES:

* MANUFACTURING AND SELLING VARIOUS TYPES OF ENGINEERING PLASTICS

PRODUCTS DEALING:

* ACETAL COPOLYMER

* POLYBUTYLENE TEREPHTHALATE

* FIBERGLASS REINFORCED POLYETHYLENE TEREPHTHALATE

* LIQUID CRYSTAL POLYMER

* POLYPHENYLENE SULFIDE

* CYCLIC OLEFIN COPOLYMER

QUALITY ASSESSMENT:

* ISO9001

* ISO14001

* ISO/TS 16949

NUMBER OF EMPLOYEES:

* POLYPLASTICS GROUP HEADCOUNT - 1,520(AS AT DECEMBER 2007)

INFORMATION ON SUBJECT:

ACTIVITIES:

* TRADING OF ENGINEERING PLASTICS

PRODUCTS AND SERVICES:

* CHEMICALS BY NAME

* ENGINEERING PLASTICS

* PLASTIC RAW MATERIALS

* PLASTIC RAW MATERIALS & SUPPLIES

* PLASTICS

* POLYAMIDES

* POLYBUTYLENE TEREPHTHALATE (PBT)

* RESINS

* SYNTHETICS, SYNTHETIC PRODUCTS & SERVICES

* THERMOPLASTIC RESINS

TRADE NAMES/ BRANDS:

* CELANESE

* CELANEX

* CELCON

* DURACON

* DURANEX

* FORTRON

* NYLON

* VECTRA

INDUSTRY TYPE:

* POLYMER / PLASTIC / RUBBER / TYRES

NUMBER OF EMPLOYEES:

* 2007: 16

NO OTHER TRADE INFORMATION WAS AVAILABLE AS TELE-INTERVIEW WAS NOT     GRANTED BY SUBJECT'S PERSONNEL

REGISTERED AND BUSINESS ADDRESS:

6 TEMASEK BOULEVARD

#25-01

SUNTEC TOWER 4

SINGAPORE 038986

DATE OF CHANGE OF ADDRESS: 06/10/1997

- RENTED PREMISE

- PREMISE OWNED BY: HSBC INSTITUTIONAL TRUST SERVICES (SINGAPORE)

LIMITED AS TRUSTEE OF SUNTEC REIT

ADDRESS PROVIDED BY CLIENT:

6 TEMASEK BOULEVARD

#45-01

SUNTEC TOWER 4

SINGAPORE 038986

- INCORRECT; THE CORRECT UNIT NUMBER IS #25-01.

WEBSITE:

http://www.polyplastics.com

EMAIL:

MANAGEMENT

THE DIRECTORS AT THE TIME OF THIS REPORT ARE:

1) TOSHIFUMI NONAKA, A JAPANESE

   - BASED IN SINGAPORE.

2) YUJI TAKAHASHI, A JAPANESE

   - BASED IN JAPAN.

3) MINORU HIROSE, A JAPANESE

   - BASED IN JAPAN.

ADVERSE ON DIRECTORS

NOTE: ADVERSE CHECK CANNOT BE CONDUCTED AS ALL ITS DIRECTORS ARE

FOREIGNERS.

GENERAL COMMENTS

Singapore’s Country Rating 2008

Investment Grade

IN SINGAPORE, THE POLITICAL AND ECONOMIC SITUATION IS VERY GOOD. A QUALITY BUSINESS ENVIRONMENT HAS A POSITIVE INFLUENCE ON CORPORATE PAYMENT BEHAVIOUR. CORPORATE DEFAULT PROBABILITY IS VERY LOW ON AVERAGE.

ECONOMIC GROWTH REMAINED STRONG IN 2007 AND IN Q1 2008 (6.7%) THANKS TO A SHARP INCREASE IN CONSUMPTION SPURRED BY A BRIGHT EMPLOYMENT PICTURE, RISING REAL WAGES, AND A POSITIVE WEALTH EFFECT PRODUCED BY RISING PROPERTY PRICES. IN THIS CONTEXT, BANKRUPTCIES CONTINUE TO DECLINE, AS REFLECTED BY THE FAVOURABLE COFACE PAYMENT INCIDENT INDEX TREND. SINGAPORE MOREOVER BOASTS THE BEST GOVERNANCE IN ASIA THANKS TO AN EFFECTIVE LEGAL SYSTEM AND A GOOD LEVEL OF FINANCIAL TRANSPARENCY.

HOWEVER, A GROWTH SLOWDOWN IS EXPECTED FOR 2008 (4.5%) AMID WEAKER DEMAND GROWTH IN THE UNITED STATES, SINGAPORE'S NUMBER TWO TRADING PARTNER. THE FOREIGN TRADE CONTRIBUTION TO GROWTH WILL THUS DECLINE ESPECIALLY WITH EXPORTS REPRESENTING 210 PER CENT OF GDP.

INFLATION ACCELERATED IN 2007 AND REACHED 7.5% IN MAY 2008 BECAUSE OF RISING RAW MATERIAL PRICES. INDEED, SINGAPORE IMPORTS ALMOST ALL ITS ENERGY AND FOOD. HOWEVER, FOR THE ENTIRE YEAR, INFLATION SHOULD MODERATE AND REACH 2.8%.

THE FINANCIAL SITUATION HAS REMAINED ROBUST AS THE EQUILIBRIUM OF PUBLIC SECTOR FINANCES AND THE SOLIDITY OF A BANKING SYSTEM POISED TO ADOPT BASEL II PRUDENTIAL STANDARDS ATTEST. EXTERNAL ACCOUNTS CONTINUE MOREOVER TO SHOW LARGE SURPLUSES THANKS TO GOOD PERFORMANCE IN A RANGE OF SECTORS INCLUDING ELECTRONICS, TRANSPORT, CONSTRUCTION, TOURISM, AND FINANCIAL SERVICES. THE DECLINE EXPECTED IN THE CURRENT ACCOUNT SURPLUS IN 2008 SHOULD NOT JEOPARDISE SINGAPORE'S EXCEPTIONAL FINANCIAL SOLIDITY.

UNDERPINNED BY SUBSTANTIAL FISCAL RESERVES AND A LARGE MAJORITY IN PARLIAMENT, THE PEOPLE'S ACTION PARTY OF PRIME MINISTER LEE HSIEN LOONG HAS SOUGHT AT ONCE TO MAKE THE CITY-STATE MORE ATTRACTIVE TO FOREIGN INVESTORS AND TO BOLSTER THE SPECIALISATION IN HIGH-VALUE ADDED SECTORS TO MEET THE GROWING COMPETITION FROM LOW-COST ASIAN ECONOMIES. BESIDES REDUCTIONS IN CORPORATE INCOME TAX AND TAX INCENTIVES FOR COMPANIES SETTING UP OPERATIONS IN SINGAPORE, THE GOVERNMENT CONTINUES TO PURSUE ITS INFRASTRUCTURE AND R&D INVESTMENT POLICY.

ASSETS

· THE COUNTRY HAS BEEN PURSUING AMBITIOUS DIVERSIFICATION STRATEGY, ESPECIALLY TO HIGH VALUE-ADDED SECTORS LIKE CHEMICALS, PHARMACEUTICALS, AND FINANCE.

· IT IS AMONG THE MOST ADVANCED COUNTRIES OF ASIA IN QUALITY COMPETITIVENESS TERMS.

· SINGAPORE HAS BECOME A MAJOR EXPORTER OF CAPITAL IN ASIA IN MANY ECONOMIC SECTORS —SUCH AS FINANCE, TELECOMMUNICATIONS, TRANSPORT — NOTABLY VIA THE STATE-OWNED TEMASEK HOLDING COMPANY

· THE ECONOMY HAS BENEFITED FROM THE COUNTRY'S POLITICAL STABILITY AND EXCELLENT BUSINESS CLIMATE.

WEAKNESSES

· SKILLED LABOUR IS IN SHORT SUPPLY IN THE SECTORS THE COUNTRY WISHES TO DEVELOP.

· THE AGEING POPULATION COULD ULTIMATELY UNDERMINE ECONOMIC PERFORMANCE.

· GROWING INEQUALITY AND THE EMERGENCE OF LONG-TERM UNEMPLOYMENT AMONG THE LEAST SKILLED COULD GENERATE SOCIAL TENSIONS.

· THE VERY OPEN ECONOMY IS VULNERABLE TO A WORLD ECONOMIC DOWNTURN.

OVERVIEW OF SINGAPORE

PAST PERFORMANCE

The Singapore economy grew at a moderate pace of 2.1% in 2Q 2008. On an annualised quarter-on-quarter basis, growth fell by 6.0%, in contrast to the 15.7% growth in the previous quarter.

The manufacturing sector fell by 5.2% in 2Q 2008, compared to 2Q 2007. The decline was mainly driven by the biomedical manufacturing cluster which fell by 28.0%.

The financial services sector rose by a smaller 10.2% in 1Q 2008, following a 13% gain in 1Q 2008. Growth was across the board, supported by robust expansions in both the domestic and offshore banking segments.

The construction sector recorded high growth, rising by 17.4%, following the robust 15% growth in 1Q 2008.

The wholesale and retail trade sector grew by 6.0% in 2Q 2008, faster than the 5.5% growth in 1Q 2008. Non-oil re-exports grew by 14.0% in 1Q 2008, higher than the 11.0% growth in 1Q 2008. Excluding motor vehicles, retail sales fell by 1.4% in 2Q 2008, compared to 1Q 2008.

The transport and storage sector rose by 5.7% in 2Q 2008, marginally higher than 5.4% in 1Q 2008. This was attributed to the double-digit growth for container throughput.

The hotels and restaurants sector grew by a slightly smaller 2.1% in 2Q 2008, following the 2.4% growth in 1Q 2008.

The information and communications sector rose 7.6% in 2Q 2008, higher than the 6.8% in 1Q 2008.

The business services sector expanded by 7.5%, slower than the 8.3% gain in 1Q 2008.

NEWS

IT’S RECESSION WATCH 2009

THE GLOOM WAS NOT JUST IN THE OFFICIAL NEWS – THAT SINGAPORE HAS SLIPPED INTO TECHNICAL RECESSION, THE FIRST TIME SINCE 2002, AND THAT THIS YEAR’S ECONOMIC GROWTH MIGHT ONLY HIT 3.0%.

IT WAS EVEN MORE VISIBLE IN THE OPINION OF SEVERAL ECONOMISTS: NEXT YEAR COULD BE WORSE.

CITIGROUP ECONOMIST KIT WEI ZHENG EXPECTS 2009 GROWTH TO BE “SLOWER, OR EVEN NEGATIVE”. THE LAST TIME SINGAPORE EXPERIENCED A FULL-SCALE RECESSION WAS IN 2001, WHEN THE ECONOMY CONTRACTED BY 2.4% DURING THE YEAR.

IN FACT, SOME ECONOMISTS FELT THE CURRRENT CRISIS COULD SURPASS THE 1997 ASIAN FINANCIAL CRISIS, ECLIPSING THE POST-911 AND SARS SLUMPS IN RECENT YEARS. OR EVEN THE RECESSIONS TRIGGERED BY THE 1985 PAN ELECTRIC COLLAPSE AND 1973 OIL SHOCK.

AND HOW QUICKLY SINGAPORE – THE FIRST ASIAN ECONOMY TO SLIP INTO RECESSION – RECOVERS HINGES ON WHETHER WESTERN GOVERNMENTS AND CENTRAL BANKS CAN RESOLVE THE CREDIT CRISIS IN THE COMING MONTHS.

“IN THE WORST-CASE SCENARIOS, IT WILL BE FAR WORSE THAN ANYTHING WE’VE SEEN BEFORE BECAUSE WE ARE TALKING ABOUT JOB LOSSES WHICH WILL CUT ACROSS ALL INDUSTRIES,” SAID CIMB-GK REGIONAL ECONOMIST SONG SENG WUN.

AND WHILE THE GOVERNMENT IS EXPECTED TO DIP INTO ITS COFFERS, THE ABILITY TO STIMULATE THE ECONOMY COULD BE HINDERED BY THE RESOURCE CRUNCH IN THE CONSTRUCTION SECTOR.

SAID SINGAPORE MANAGEMENT UNIVERSITY ECONOMICS PROFESSOR DAVIN CHOR:”THE CONSTRUCTION SECTOR HAS RELATIVELY LIMITED CAPACITY TO EXPAND IN THE SHORT TERM.”

BUT MR SONG ARGUED THAT THE CONSTRUCTION CRUNCH COULD BE A BLESSING IN DISGUISE, GIVEN THAT BUILDING COSTS WOULD “TUMBLE QUICKLY” BY THE FIRST QUARTER OF NEXT YEAR. SAID MR SONG: “PROJECTS, WHICH HAVE BEEN PUT ON THE BACKBURNER, CAN BE BROUGHT FORWARD.”

AND WHILE MUCH HOPES ARE PINNED ON THE UPCOMING MARINA BAY SANDS INTEGRATED RESORT – SLATED TO OPEN ITS DOORS NEXT YEAR – EXPERTS ARE CAUTIOUS ABOUT ITS IMPACT, ESPECIALLY LAS VEGAS SANDS – WHICH CLINCHED THE LICENCE TO BUILD THE IR – HAS SEEN GAMING EARNINGS FALL IN ITS CHIEF MARKETS IN THE US AND MACAU.

SAID FORECAST ECONOMIST VISHNU VARATHAN: “FROM THE OPERATORS’ POINT OF VIEW, THEY MAY BE FACING THEIR OWN FINANCIAL DIFFICULTIES. AND A SLOWING ECONOMY MEANS FEWER VISITORS, LESS SPENDING POWER.”

WHEN CONTACTED, MARINA BAY SANDS GENERAL MANAGER GEORGE TANASIJEVICH SAID THE GROUP “REMAINS 100% COMMITTED TO SINGAPORE AND TO HELPING SINGAPORE ACHIEVE ITS TOURISM GOALS”.

PRIME MINISTER LEE HSIEN LOONG REITERATED ON FRIDAY THAT SINGAPORE IS WELL-PLACED TO RIDE THROUGH THE “FINANCIAL STORM”, BUOYED BY THE MOMENTUM FROM PROJECTS SUCH AS THE RECENT SINGAPORE GRAND PRIX. SAID MR LEE:”OUR FINANCIAL SYSTEM IS SOUND, AND OUR ECONOMY REMAINS COMPETITIVE.

“OVER THE LAST FEW YEARS, WHEN CONDITIONS WERE GOOD, WE HAD CONSCIOUSLY DECIDED TO MAKE THE BEST OF THE GOOD TIMES AND PRESSED ON WITH UPGRADING AND DIVERSIFYING OUR ECONOMY. THIS WILL MEAN NEW AND BETTER JOBS, EVEN IF SOME OLD ONES ARE LOST.”

MR VARATHAN EXPECTS THE ECONOMY TO GROW 3.0% NEXT YEAR – MATCHING THE OFFICIAL FORECAST FOR GROWTH THIS YEAR.

UOB ECONOMIST HO WOEI CHEN FEELS THAT THE WORST IS YET TO COME.

SAID MD HO: “THE BANKS ARE THE ONES WHO HAVE BEEN HURT… WE WILL SEE THE CRISIS TRANSLATING INTO THE REAL SECTORS OF THE ECONOMY.”

MANUFACTURING WILL CONTINUE TO BE A DRAG ON THE ECONOMY, WITH THE RETAIL AND SERVICES INDUSTRY POISED FOR A HIT. BUT SINGAPORE, WHERE THE BANKING SCENE IS DOMINATED BY PRIVATE BANKING, WOULD LIKELY BE HURT LESS THAN ITS RIVAL HONG KONG, ASIA’S CENTRE FOR INVESTMENT BANKING, SAID MS HO.

MR VARATHAN EXPECTS INDUSTRIES DEALING IN ENERGY, FOOD AND WATER – WHICH ARE NOT KEY DRIVERS OF SINGAPORE’S ECONOMY – TO BE SHIELDED FROM THE DOWNTURN.

OUTLOOK

THE COMPOSITE LEADING INDEX (CLI) ROSE MARGINALLY BY 0.5% IN 2Q 2008, FOLLOWING THE 2.8% DECLINE IN 1Q 2008. OF THE NINE COMPONENTS WITHIN THE INDEX, THREE COMPONENTS RECORDED DECLINES WHILE THE REMAINING SIX COMPONENTS ROSE MARGINALLY. THE SIX INDICATORS THAT REGISTERED IMPROVEMENTS ARE THE MONEY SUPPLY, NON-OIL SEA CARGO HANDLED, STOCK PRICE, US PURCHASING MANAGER’S INDEX, STOCK OF FINISHED GOODS AND DOMESTIC LIQUIDITY.

OVERALL, THE SINGAPORE ECONOMY REMAINED RESILENT IN 1ST HALF OF 2008, DESPITE THE SLOWDOWNS IN MAJOR EXTERNAL ECONOMIES AND GLOBAL INFLATION CONCERNS. THE ECONOMY GREW BY 4.5% IN 1ST HALF OF 2008.

LOOKING AHEAD, THE GLOBAL ECONOMIC ENVIRONMENT WILL REMAIN WEAK FOR THE REST OF THE YEAR AND WELL INTO 2009. THE DEVELOPED ECONOMIES ARE EXPERIENCING A BROAD SLOWDOWN IN ECONOMIC ACTIVITY. SLUGGISH GROWTH IS EXPECTED OVER THE NEXT SIX TO TWELVE MONTHS, AS THE EFFECTS OF THE US FINANCIAL AND HOUSING SLUMPS RIPPLE ITS EFFECT THROUGHOUT THE WORLD. THESE WILL HAVE AN ADVERSE IMPACT ON EMPLOYMENT, BUSINESS CONFIDENCE, CONSUMER SPENDING AND OVERALL DEMAND. EMERGING ECONOMIES PARTICULARY THOSE IN ASIA, HAVE CONTINUED TO GROW, PROVIDING SOME SUPPORT TO GLOBAL DEMAND AND GROWTH. HOWEVER, THE US AND EUROPE SLOWDOWN WILL HAVE A DOWNSIDE IMPACT ON THE ASIAN ECONOMIES. AT THE SAME TIME, INFLATION CONTINUES TO PERSIST AND POSES A CHALLENGE FOR POLICY MAKERS IN COUNTRIES SUCH AS CHINA, INDIA, INDONESIA AND VIETNAM.

THE PACE OF GROWTH OF SINGAPORE’S ECONOMY HAS SLOWED DOWN, ATTRIBUTED MAINLY TO WEAKNESSES IN DOMESTIC AND EXTERNAL DEMAND. WHILE THE COMPOSITE LEADING INDICATOR POINTS TOWARDS A SLIGHT PICKUP, BUSINESS PERFORMANCE OF PERFORMANCE ACROSS THE SECTORS ARE MIXED.

IN VIEW OF THE OUTLOOK FOR THE MAJOR SECTORS AND A SLOWDOWN IN THE GLOBAL ECONOMIC ENVIRONMENT, THE MINISTRY OF TRADE AND INDUSTRY LOWERED THE 2008 GDP GROWTH FORECAST FROM 4.0-6.0% IN THE LAST QUARTER, TO 4.0-5.0%.

IN THE FINANCIAL SERVICES INDUSTRY, MAJORITY OF THE BANKS AND FINANCE COMPANIES FORECAST BUSINESS OUTLOOK TO REMAIN THE SAME FOR THE 2ND HALF OF 2008 OVER THE 1ST HALF OF 2008. BANKS AND FINANCE COMPANIES ARE MORE OPTIMISTIC WHILE STOCK, SHARE AND BOND BROKERS, FUND MANAGERS AND INSURANCE COMPANIES FORECAST SLOWER BUSINESS ACTIVITY IN THE COMING MONTHS, MAINLY DUE TO UNCERTAINTY IN THE INVESTMENT CLIMATE AND GLOBAL ECONOMY.

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

A SLOWER BUSINESS CLIMATE FOR THE COMING MONTHS.

IN THE SERVICES INDUSTRY, A NET WEIGHTED BALANCE OF 24% OF FIRMS, EXPECT BUSINESS TO BE BRISK FOR THE COMING MONTHS WHILE A WEIGHTED 22% OF FIRMS PROJECTS LESS FAVOURABLE BUSINESS CONDITIONS. MAJORITY OF THE FIRMS (A WEIGHTED 54%) EXPECT BUSINESS ACTIVITIES TO REMAIN STABLE FOR THE COMING MONTHS. THIS RESULTS IN A NET WEIGHTED BALANCE OF 2% OF FIRMS EXPECTING A POSITIVE BUSINESS OUTLOOK. THIS MAGNITUDE IS SMALLER THAN THE NET WEIGHTED BALANCE OF 28% REGISTERED IN THE SAME PERIOD FOR 2007 (IE JUL – DEC 2007) AND COMPARABLE TO THE NET WEIGHTED BALANCE OF 3% RECORDED FOR APR-SEP 2008 IN THE PREVIOUS QUARTER.

GENERALLY, THE MAJORITY OF WHOLESALERS, WITH A NET WEIGHTED BALANCE OF 55% OF FIRMS, FORECASTS BUSINESS ACTIVITIES IN THE COMING MONTHS, TO REMAIN AT SIMILAR LEVELS. FOR THE REMAINING WHOLESALE FIRMS, A WEIGHTED 22% OF THEM EXPECTS BETTER BUSINESS CONDITIONS TO IMPROVE. THESE FIRMS ARE MAINLY IN THE BUSINESS OF WHOLESALE TRADE OF INDUSTRIAL MACHINERY AND EQUIPMENT, ELECTRONIC COMPONENTS, AND COMPUTER AND ACCESSORIES. ON THE OTHER HAND, A WEIGHTED 23% OF WHOLESALERS, MAINLY FROM FOOD AND BEVERAGES, AND PETROLEUM AND PETROLEUM PRODUCTS, FORECAST BUSINESS CONDITIONS TO DETERIORATE IN THE COMING MONTHS. ON THE WHOLE, A NET WEIGHTED BALANCE OF 1% OF FIRMS EXPECTS GENERAL BUSINESS OUTLOOK TO REMAIN LESS FAVOURABLE.

A NET WEIGHTED BALANCE OF 20% OF RETAILERS PREDICTS LESS FAVOURABLE BUSINESS CONDITIONS FOR THE PERIOD ENDING DECEMBER 2008. MOTOR VEHICLES RETAILERS, AND JEWWELLERY AND WATCHES CONTINUE TO PREDICT SLOWER SALES IN THE MONTHS AHEAD.

IN THE TRANSPORT AND STORAGE INDUSTRY, A NET WEIGHTED BALANCE OF 8% OF FIRMS FORECASTS BETTER FAVOURABLE BUSINESS CONDITIONS FOR THE COMING MONTHS. THE SEGMENTS EXPECTING HIGHER BUSINESS ACTIVITIES ARE LAND TRANSPORT AND

SHIPPING LINES.

HOTELIERS REMAIN CONFIDENT ABOUT THE BUSINESS CLIMATE IN THE MONTHS AHEAD, WITH A NET WEIGHTED BALANCE OF 37% OF HOTELIERS EXPECTING THEIR BUSINESSES TO IMPROVE. IN THE CATERING TRADE INDUSTRY, BUSINESS CONDITIONS ARE EXPECTED TO BE LESS OPTIMISTIC. IN PARTICULAR, CONVENTIONAL RESTAURANTS AND FOOD CATERERS MENTIONED HIGH OPERATING COSTS AS THE REASON FOR THE LESS POSITIVE OUTLOOK.

IN THE INFORMATION AND COMMUNICATIONS INDUSTRY, A NET WEIGHTED BALANCE OF 12% OF FIRMS PREDICTS BETTER BUSINESS.

IN THE BUSINESS SERVICES INDUSTRY, A NET WEIGHTED BALANCE OF 17% OF FIRMS PREDICTS POSITIVE SENTIMENTS. THESE INCLUDE THOSE ENGAGED IN ENGINEERING, INDUSTRIAL DESIGN, TECHNICAL TESTING AND ANALYSIS, AND INVESTIGATION AND SECURITY ACTIVITIES.

EXTRACTED FROM: MINISTRY OF TRADE AND INDUSTRY, SINGAPORE

SINGAPORE DEPARTMENT OF STATISTICS

TODAY

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.49.95
UK Pound	1	Rs.79.56
Euro	1	Rs.63.65

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

MIRA INFORM REPORT

Subject Company

Line Of Business

Parent Company

Financial Elements

COMPANY IDENTIFICATION

SUMMARY

REFERENCES

PRINCIPAL(S)

DIRECTOR(S)

ACTIVITY(IES)

SHAREHOLDERS(S)

HOLDING COMPANY

PAYMENT HISTORY AND EXPERIENCES

FINANCIAL ELEMENTS

RATIOS

FINANCIAL COMMENTS

BACKGROUND/OPERATION

MANAGEMENT

ADVERSE ON DIRECTORS

GENERAL COMMENTS

Singapore’s Country Rating 2008

Unit