MIRA INFORM REPORT

Report Date :

17.08.2011

IDENTIFICATION DETAILS

Name :	SICHUAN CONSTRUCTION MACHINERY (GROUP) CO., LTD.
Registered Office :	Dongzikou, Waibei, Chengdu, Sichuan Province 610081 Pr
Country :	China
Financials (as on) :	31.12.2010
Date of Incorporation :	01.10.1993
Com. Reg. No.:	510100000092913
Legal Form :	Shares Limited Company
Line of Business :	Manufacturing and selling construction machinery, printing machinery, metal structure, class I, II pressure vessel, etc

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

Maximum Credit Limit :	USD 2,000,000
Status :	Satisfactory
Payment Behaviour :	Usually Correct
Litigation :	Clear

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – March 31^st, 2011

Country Name	Previous Rating (31.12.2010)	Current Rating (31.03.2011)
China	A2	A2

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Company name and address

SICHUAN CONSTRUCTION MACHINERY (GROUP) CO., LTD.

DONGZIKOU, WAIBEI, CHENGDU, SICHUAN PROVINCE 610081 PR CHINA

TEL: 86 (0) 28-83115304/86472020

FAX: 86 (0) 28-83115334

EXECUTIVE SUMMARY

Date of Registration : october 1, 1993

REGISTRATION NO. : 510100000092913

LEGAL FORM : SHARES LIMITED COMPANY

CHIEF EXECUTIVE : wang baotian (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : CNY 73,000,000

staff : 1,980

BUSINESS CATEGORY : manufacturing

Revenue : CNY 462,830,000 (AS OF DEC. 31, 2010)

EQUITIES : CNY 360,730,000 (AS OF DEC. 31, 2010)

WEBSITE : www.scm-china.com

E-MAIL : scm@scm-china.com; scmchina@mail.sc.cninfo.net

PAYMENT : AVERAGE

Recommended Credit Limit: UP TO USD 2,000,000 (PERIODICAL REVIEW)

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : stable

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : fairly good

EXCHANGE RATE : CNY 6.39 = USD 1

Adopted abbreviations (as follows)

SC - Subject Company (the company inquired by you)

N/A – Not available

CNY – China Yuan Ren Min Bi

OPERATIONAL TREND & GENERAL REPUTATION

This section aims at indicating the relative positions of SC in respect of its operational trend & general reputation

Operational Trend:- General Reputation:-

Upward Excellent

Steady Good

Fairly Steady Fairly Good

Ordinary Average

Fair Fair

Stagnant Detrimental

Downward Not known

Not known Not yet be determined

Not yet be determined

LEGAL STATUS & HISTORY

SC was established as a limited liabilities company of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 510100000092913 on October 1, 1993.

SC’s Organization Code Certificate No.: 201909325

SC’s Tax No.: 510106201909325

SC’s registered capital: CNY 73,000,000

SC’s paid-in capital: CNY 73,000,000

Registration Change Record:

Date	Change of Contents	Before the change	After the change
--	Legal Representative	Yuan Zhuxi	Wang Baotian

Current Co search indicates SC’s shareholders & chief executives are as follows:-

Name of Shareholder (s)	% of Shareholding
Beijing Institute of Construction Mechanization	0.68
Individuals	75.35
Labor Union of Sichuan Construction Machinery	20.55
Taiwan Jianchuan Enterprise Co., Ltd. (Literal Translation)	1.37
Moreton (H.K.) Limited	0.68
ZheJiang Jianhuan Electric & Machinery Co., Ltd.	1.37

SC’s Chief Executives:-

Position	Name
Legal Representative, Chairman, and General Manager	Wang Baotian
Director	Zhang Kejie
Supervisor	Du Bing

RECENT DEVELOPMENT

SC’s quality system meets the international standards of ISO 9001.

Other Honors:

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

Beijing Institute of Construction Mechanization 0.68

Individuals 75.35

Labor Union of Sichuan Construction Machinery 20.55

Taiwan Jianchuan Enterprise Co., Ltd. (Literal Translation) 1.37

Moreton (H.K.) Limited 0.68

ZheJiang Jianhuan Electric & Machinery Co., Ltd. 1.37

Beijing Institute of Construction Mechanization

=======================================

Date of Registration : July 25, 2001

Registration No. : 110000003128393

Legal Form : State-owned Enterprise

Chief Executive : Li Shoulin (Legal Representative)

Registered Capital : CNY 25,000,000

Tel: 010-84018402/84018483/84018463/84018510

Fax: 010-84018348

E-mail: 84018348@163.com

Registration No.: 110000003128393

Legal Representative: Li Shoulin

Moreton (H.K.) Limited

======================

CR No.: 0140995

Date of Registration: October 1, 1993

Company Status: Private

Active Status: Live

ZheJiang Jianhuan Electric & Machinery Co., Ltd.

=========================================

Registration No.: 330782000041563

Legal Representative: Lou Yufang

Registered Capital: CNY 10,000,000

Tel: 0579- 85546111/85546172

Fax: 0579-85546442

Website: www.zjjianhuan.com

E-mail: zjjianhuan@zjjianhuan.com

MANAGEMENT

Wang Baotian , Legal Representative, Chairman and General Manager

-------------------------------------------------------------------------------------------------------

Ø Gender: M

Ø Qualification: University

Ø Working experience (s):

At present, working in SC as legal representative, chairman and general manager

Zhang Kejie , Director

----------------------------------------

Ø Gender: M

Ø Qualification: University

Du Bing , Supervisor

-----------------------------------

Ø Gender: M

Ø Qualification: University

BUSINESS OPERATION

SC’s registered business scope includes manufacturing and selling construction machinery, printing machinery, metal structure, class I, II pressure vessel; exporting tower crane and parts; importing raw materials, machinery equipment, instruments and parts and technology needed in the manufacture; affecting Chinese foreign equity joint venture enterprise and Chinese foreign contractual joint venture enterprise; processing with imported materials, processing with imported samples, assembling with imported parts, and compensation trade in agreement; realty management, storage and technology consultation; industrial and civil engineering construction and installation; manufacturing and selling common machinery, leasing construction mechanical equipment; steel construction; common freight; refit and selling concrete pump truck of arm style with ‘chuanjian’ brand, transit mixing truck; manufacturing, installing and repairing common tower crane and elevator; engineering construction.

SC is mainly engaged in manufacturing and selling construction machinery.

Brand:

SC’s products mainly include: tower crane, concrete equipment, construction hoist, etc.

SC sources its materials 80% from domestic market, and 20% from overseas market. SC sells 70% of its products in domestic market, and 30% to overseas market, mainly Indonesia, Malaysia, Philippines, Pakistan, Vietnam, Thailand, Turkey, Saudi Arabia, United Arab Emirates, Qatar, Jordan, Kazakhstan, Chile, Panama, Ukraine, Russia, Angola, and etc.

The buying terms of SC include Check, T/T, L/C and Credit of 30-60 days. The payment terms of SC include Check, T/T, L/C and Credit of 30-60 days.

Staff & Office:

--------------------------

SC is known to have approx. 1,980 staff at present.

SC rents an area as its operating office and factory, but the detailed information is unknown.

RELATED COMPANY

SC is known to have 3 subsidiaries at present:

===================================

u Chengdu Leta Printing Machinery Co., Ltd.

u Chengdu Jinchuanjian Industrial Co., Ltd.

u Chengdu Chuanjianxing Construction Engineering Co., Ltd.

PAYMENT

Overall payment appraisal:

( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet be determined

The appraisal serves as a reference to reveal SC's payments habits and ability to pay. It is based on the 3 weighed factors: Trade payment experience (through current enquiry with SC's suppliers), our delinquent payment and our debt collection record concerning SC.

Trade payment experience: SC did not provide any name of trade/service suppliers and we have no other sources to conduct the enquiry at present.

Delinquent payment record: None in our database.

Debt collection record: No overdue amount owed by SC was placed to us for collection within the last 6 years.

BANKING

The bank information of SC is not filed in SAIC.

FINANCIALS

Balance Sheet

Unit: CNY’000	As of Dec. 31, 2009	As of Dec. 31, 2010
Cash	165,350	161,700
Accounts receivable	32,170	35,470
Advances to suppliers	7,390	11,660
Other receivable	3,610	3,750
Inventory	82,500	102,830
Non-current assets within one year	0	0
Other current assets	40,200	51,050
	------------------	------------------
Current assets	331,220	366,460
Fixed assets	238,030	239,970
Construction in progress	1,690	2,330
Long-term equity investment	19,260	19,570
Deferred income tax assets	0	0
Other non-current assets	0	0
	------------------	------------------
Total assets	590,200	628,330
	=============	=============
Short-term loans	50,000	50,000
Notes payable	0	0
Accounts payable	43,370	81,330
Wages payable	5,560	5,560
Advances from clients	42,160	40,120
Other payable	19,710	16,600
Other current liabilities	93,870	78,690
	------------------	------------------
Current liabilities	254,670	272,300
Non-current liabilities	43,930	-4,700
	------------------	------------------
Total liabilities	298,600	267,600
Equities	291,600	360,730
	------------------	------------------
Total liabilities & equities	590,200	628,330
	=============	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2010
Revenue	462,830
Cost of sales	349,370
Sales expense	38,460
Management expense	45,330
Finance expense	6,480
Investment income	7,420
Profit before tax	32,820
Less: profit tax	4,100
Profits	28,720

Important Ratios

=============

	As of Dec. 31, 2009	As of Dec. 31, 2010
*Current ratio	1.30	1.35
*Quick ratio	0.98	0.97
*Liabilities to assets	0.51	0.43
*Net profit margin (%)	--	6.21
*Return on total assets (%)	--	4.57
*Inventory / Revenue ×365	--	82 days
*Accounts receivable/ Revenue ×365	--	28 days
* Revenue/Total assets	--	0.74
* Cost of sales / Revenue	--	0.75

FINANCIAL COMMENTS

PROFITABILITY: FAIRLY GOOD

l The revenue of SC appears fairly good in its line in 2010.

l SC’s net profit margin is fairly good in 2010.

l SC’s return on total assets is fairly good in 2010.

l SC’s cost of goods sold is average, comparing with its revenue.

LIQUIDITY: AVERAGE

l The current ratio of SC is maintained in a normal level in both years.

l SC’s quick ratio is maintained in a normal level in both years.

l The inventory of SC appears large.

l The accounts receivable of SC is maintained in an average level.

l SC’s short-term loan is in an average level.

l SC’s revenue is in an average level, comparing with the size of its total assets.

LEVERAGE: AVERAGE

l The debt ratio of SC is average in both years.

l The risk for SC to go bankrupt is low.

Overall financial condition of the SC: Stable.

CONCLUSIONS

SC is considered large-sized in its line with stable financial conditions. The large amount of inventory may be a threat to SC’s financial condition. A credit line up to USD 2,000,000 is recommended upon a periodical review basis.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.45.24
UK Pound	1	Rs.73.88
Euro	1	Rs.65.06

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	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
--	NB	New Business	--

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

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.