MIRA INFORM REPORT

Report Date :

01.12.2011

IDENTIFICATION DETAILS

Name :	PHARMAPACK (GUANGZHOU) PACKAGING EQUIPMENT CO., LTD.
Registered Office :	No. 1, Yanhe Road, Economic Technology Development Zone Guangzhou, Guangdong Province 510730 Pr
Country :	China
Financials (as on) :	31.12.2010
Date of Incorporation :	15.10.2002
Com. Reg. No.:	440108400009833
Legal Form :	Chinese Foreign Equity Joint Venture Enterprise
Line of Business :	Manufacturing and processing various packaging devices, liquid canned equipment, related spare parts and materials; selling its products; providing after-sale services.
No. of Employees :	211

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 :	No Complaints
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 – September 30, 2011

Country Name	Previous Rating (30.06.2011)	Current Rating (30.09.2011)
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

PHARMAPACK (GUANGZHOU) PACKAGING EQUIPMENT CO., LTD.

NO. 1, YANHE ROAD, ECONOMIC TECHNOLOGY DEVELOPMENT ZONE

GUANGZHOU, GUANGDONG PROVINCE 510730 PR CHINA

TEL: 86 (0) 20-82215907

FAX: 86 (0) 20-82213367

EXECUTIVE SUMMARY

Date of Registration : OCTober 15, 2002

REGISTRATION NO. : 440108400009833

LEGAL FORM : CHINESE FOREIGN EQUITY JOINT VENTURE ENTERPRISE

CHIEF EXECUTIVE : jiang dewei (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : HKD 1,515,300

staff : 211

BUSINESS CATEGORY : manufacturing

REVENUE : CNY 57,850,000 (AS OF DEC. 31, 2010)

EQUITIES : CNY 13,840,000 (AS OF DEC. 31, 2010)

WEBSITE : www.pppharmapack.com

E-MAIL : market@pppharmapack.com

PAYMENT : AVERAGE

MARKET CONDITION : average

FINANCIAL CONDITION : FAIRly stable

OPERATIONAL TREND : fairly STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.38 = 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 wholly foreign-owned enterprise of PRC on October 15, 2002. However, SC changed to present legal form, and was registered as Chinese foreign equity joint venture enterprise of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 440108400009833 in 2011.

SC’s Organization Code Certificate No.: 74359735-4

SC’s registered capital: HKD 1,515,300

SC’s paid-in capital: HKD 1,515,300

Registration Change Record:

Date	Change of Contents	Before the change	After the change
2011	Registration No.	100827	440108400009833
	Registered Capital	HKD 1,000,000	HKD 1,515,300
	Shareholder (s) (% of Shareholding)	(HK) Pharmapack Asia Limited 100%	(HK) Pharmapack Asia Limited 65.99% Guangzhou Jiameng Enterprise Management & Consultation Co., Ltd.34.01%
	Legal Form	Wholly foreign-owned enterprise	Chinese foreign equity joint venture enterprise

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

Name of Shareholder (s)	% of Shareholding
(HK) Pharmapack Asia Limited	65.99
Guangzhou Jiameng Enterprise Management & Consultation Co., Ltd.	34.01

SC’s Chief Executives:-

Position	Name
Legal Representative, Chairman, and General Manager	Jiang Dewei

RECENT DEVELOPMENT

SC has got Hi-Tech Enterprise Certificate, etc.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

(HK) Pharmapack Asia Limited 65.99

Guangzhou Jiameng Enterprise Management & Consultation Co., Ltd. 34.01

¨ (HK) Pharmapack Asia Limited

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

Registration No.: 0802886

Date of Registration: June 19, 2002

Legal Form: Private

Status: Live

¨ Guangzhou Jiameng Enterprise Management & Consultation Co., Ltd.

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

Registration No.: 440108000045531

Date of Registration: July 18, 2011

Legal Form: Limited Liabilities Company

Registered Capital: CNY 600,000

Legal Representative: Qi Xianjun

MANAGEMENT

Jiang Dewei , Legal Representative, Chairman, and General Manager

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

Ø Gender: M

Ø Nationality: Hong Kong

Ø Age: 46

Ø Qualification: University

Ø Working experience (s):

From 2002 to present, working in SC as legal representative, chairman, and general manager

BUSINESS OPERATION

SC’s registered business scope includes manufacturing and processing various packaging devices, liquid canned equipment, related spare parts and materials; selling its products; providing after-sale services.

SC is mainly engaged in manufacturing and selling packaging equipment.

SC’s products mainly include: sieve machine, unscrambler, etc.

SC sources its materials 80% from domestic market, and 20% from the overseas market. SC sells 40% of its products in domestic market, and 60% to the overseas market.

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. 211 staff at present.

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

RELATED COMPANY

SC is not known to have any subsidiary at present.

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

Basic Bank:

China Construction Bank

AC#：132021009772

FINANCIALS

Balance Sheet

Unit: CNY’000	As of Dec. 31, 2009	As of Dec. 31, 2010
Cash	6,342	11,750
Short term investment	50	0
Accounts receivable	4,838	10,850
Advances to suppliers	4,038	0
Other receivable	3,206	3,380
Inventory	8,463	19,190
Deferred expense	1	0
Non-current assets within one year	0	0
Other current assets	1	10,920
	------------------	------------------
Current assets	26,939	56,090
Fixed assets	854	1,760
Construction in progress	0	0
Long-term prepaid expenses	0	0
Deferred income tax assets	0	0
Other non-current assets	260	530
	------------------	------------------
Total assets	28,053	58,380
	=============	=============
Short-term loan	5,000	6,000
Notes payable	0	0
Accounts payable	4,944	9,340
Wages payable	835	0
Taxes payable	555	0
Welfares payable	93	0
Advances from clients	3,226	21,720
Other payable	3,776	3,620
Drawing expense in advance	1,088	0
Other current liabilities	2	3,860
	------------------	------------------
Current liabilities	19,519	44,540
Non-current liabilities	1,954	0
	------------------	------------------
Total liabilities	21,473	44,540
Equities	6,580	13,840
	------------------	------------------
Total liabilities & equities	28,053	58,380
	=============	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2009	As of Dec. 31, 2010
Revenue	36,120	57,850
Cost of sales	19,857	28,630
Sales expense	6,567	10,050
Management expense	6,488	9,580
Finance expense	294	670
Profit before tax	3,077	10,770
Less: profit tax	316	1,410
Profits	2,761	9,360

Important Ratios

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

	As of Dec. 31, 2009	As of Dec. 31, 2010
*Current ratio	1.38	1.26
*Quick ratio	0.95	0.83
*Liabilities to assets	0.77	0.76
*Net profit margin (%)	7.64	16.18
*Return on total assets (%)	9.84	16.03
*Inventory / Revenue ×365	86 days	122 days
*Accounts receivable/ Revenue ×365	49 days	69 days
* Revenue/Total assets	1.29	0.99
* Cost of sales / Revenue	0.55	0.49

FINANCIAL COMMENTS

PROFITABILITY: FAIRLY GOOD

l The revenue of SC appears average in its line, and it increased in 2010.

l SC’s net profit margin is fairly good in 2009, good in 2010.

l SC’s return on total assets is fairly good in 2009, 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 fairly large in 2010.

l The accounts receivable of SC appears fairly large in 2010.

l The short-term loans of SC appear average.

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 average.

Overall financial condition of the SC: Fairly Stable.

CONCLUSIONS

SC is considered medium-sized in its line with fairly stable financial conditions. The fairly large amount of inventory and accounts receivable may be a threat to SC’s financial condition. A credit line up to USD 100,000 is recommended upon a periodical review basis.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.52.16
UK Pound	1	Rs.81.29
Euro	1	Rs.69.47

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.