MIRA INFORM REPORT

Report Date :

02.12.2011

IDENTIFICATION DETAILS

Name :	TH MILK FOOD JOINT STOCK COMPANY

Registered Office :	Nghia Son Commune, Nghia Dan District, Nghe An Province

Country :	Vietnam

Financials (as on) :	31.12.2009

Year of Establishment :	2009

Com. Reg. No.:	0103414411

Legal Form :	Joint Stock Company

Line of Business :	Production and trading milk, soya milk and other dairy products

No. of Employees :	350 Persons

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate

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^th, 2011

Country Name

Previous Rating

(30.06.2011)

Current Rating

(30.09.2011)

Vietnam

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

SUBJECT IDENTIFICATION & LEGAL FORM

Current legal status
English Name		TH MILK FOOD JOINT STOCK COMPANY
Vietnamese Name		CONG TY CO PHAN THUC PHAM SUA TH
Trade name		TH MILK
Short name		TH MILK FOOD
Type of Business		Joint stock company
Year Established		2009
Business Registration No.		0103414411
Date of Registration		29 Jun 2011
Place of Registration		Department of Planning and Investment of Nghe An Province
Current registered capital		500,000,000,000 VND
Status		Unlisted
Tax code		0103414411
Total Employees		350
Size		Large

Note: The correct name is as above.

Historical Identification & Legal form

List

Changed Items

Date of changes

Subject has got former Chartered capital: 20 Billion VND

Changed to: 500 Billion VND

29 Jun 2011

Subject has got former Board Of Director: DOAN ANH TUNG (General Director) Changed to: GILINBAR(General Director)

N/A

company ADDRESSES

Head Office
Address		Nghia Son Commune, Nghia Dan District, Nghe An Province, Vietnam
Telephone		(84-38) 3963094
Fax		(84-38) 3963091
Website		www.thmilk.vn
Note: This address is also the farm and factory.

Representative office in Ha Noi
Address		No. 6 Chua Boc Str. - Quang Trung Ward, Dong Da District, Ha Noi City, Vietnam
Telephone		(84-4) 35739777
Manager		Mr. TRAN BAO MINH
Note: This location share with representative office of TH Food Chain JSC. The former address of Hanoi representative office was No. 9 Dao Duy Anh Str., Dong Da Dist., Hanoi City.

Representative office in Ho Chi Minh
Address		5th Floor Sailing Tower-111A Pasteur Str, Ben Nghe Ward , 1 District, Ho Chi Minh City, Vietnam
Telephone		(84-8) 62918888
Fax		(84-8) 62917373

DIRECTORS

1. NAME		Mr. GILINBAR
Position		General Director
Date of Birth		17 Sep 1969
ID Number/Passport		10922907
ID Issue Date		22 Jul 2007
ID Issue Place		Israel
Current resident		Nghia Son commune, Nghia Dan District, Nghe An Province, Vietnam
Nationality		Israel

2. NAME		Mr. NGO MINH HAI
Position		Deputy General Director
Contact Address		Nghia Son Commune, Nghia Dan District, Nghe An Province, Vietnam
Nationality		Vietnamese
Qualification		Management

3. NAME		Ms. MAI THUY DUONG
Position		Former Chief Accountant
Current resident		Ha Noi City, Vietnam
Nationality		Vietnamese
Qualification		Bachelor

4. NAME		Mr. NGUYEN LE HUY
Position		Chief Accountant
Contact Address		Nghia Son Commune, Nghia Dan District, Nghe An Province, Vietnam
Nationality		Vietnamese
Tel/Mobil phone		+84909090089

BUSINESS NATURE AND ACTIVITIES

- Production and trading milk, soya milk and other dairy products.
- Trading, processing in fruit juice drinking.
- Trading raw materials, machinery and equipment for production of milk and food.
- Growing and breeding cow.

IMPORT & EXPORT ACTIVITIES

IMPORT:
· Types of products		Cow
· Market		New Zealand
· Mode of payment		L/C

EXPORT:
· Market		N/A

BANKERS

1. NORTH ASIA COMMERCIAL JOINT STOCK BANK THAI HA BRANCH
Address		No. 80 Nguyen Chi Thanh Str, Dong Da District, Ha Noi City, Vietnam
Telephone		(84-4) 37759011
Fax		(84-4) 37759013

2. NORTH ASIA COMMERCIAL JOINT STOCK BANK HO CHI MINH BRANCH
Address		No.125 Ba Huyen Thanh Quan ,No. 9 ward, 3 District, Ho Chi Minh City, Vietnam
Telephone		(84-8) 35261022
Fax		(84-8) 35261024

SHAREHOLDERS

The following is the founded shareholder.
1. NAME		VAN NIEN CONSTRUCTION AND TRADING SERVICES JOINT STOCK COMPANY
Business Registration		2900354478
Address		No 166 Nguyen Thai Hoc str., Vinh City, Nghe An Province, Vietnam
Number of shares		7,500,000
Value of shares		75,000,000,000 VND
Percentage		15%

2. NAME		MAY FORESTRY JOINT STOCK COMPANY
Business Registration		2901206835
Address		No 166 Nguyen Thai Hoc str., Quang Trung ward, Vinh City, Nghe An Province, Vietnam
Number of shares		10,000,000
Value of shares		100,000,000,000 VND
Percentage		20%

3. NAME		Mr. THAI HUONG
ID Number/Passport		186086406
Resident		102, Nguyen Thi Minh Khai Str, Hung Binh Ward, Nghe An Province, Vietnam
Nationality		Vietnamese
Number of Shares		2,500,000
Value of shares		25,000,000,000 VND
Percentage		5%

FINANCIAL DATA

BALANCE SHEET
Unit: One VND
Balance sheet date	31/12/2009
Number of weeks	52
ASSETS
A – CURRENT ASSETS	96,741,816,205
I. Cash and cash equivalents	1,652,137,679
1. Cash	1,652,137,679
2. Cash equivalents	0
II. Short-term investments	0
1. Short-term investments	0
2. Provisions for devaluation of short-term investments	0
III. Accounts receivable	90,951,321,637
1. Receivable from customers	0
2. Prepayments to suppliers	88,994,210,637
3. Inter-company receivable	0
4. Receivable according to the progress of construction	0
5. Other receivable	1,957,111,000
6. Provisions for bad debts	0
IV. Inventories	1,567,453,476
1. Inventories	1,567,453,476
2. Provisions for devaluation of inventories	0
V. Other Current Assets	2,570,903,413
1. Short-term prepaid expenses	0
2. VAT to be deducted	1,859,177,860
3. Taxes and other accounts receivable from the State	0
4. Other current assets	711,725,553
B. LONG-TERM ASSETS	81,533,666,436
I. Long term account receivable	0
1. Long term account receivable from customers	0
2. Working capital in affiliates	0
3. Long-term inter-company receivable	0
4. Other long-term receivable	0
5. Provisions for bad debts from customers	0
II. Fixed assets	62,239,241,815
1. Tangible assets	2,804,116,932
- Historical costs	2,831,797,415
- Accumulated depreciation	-27,680,483
2. Financial leasehold assets	0
- Historical costs	0
- Accumulated depreciation	0
3. Intangible assets	8,250,000
- Initial costs	9,000,000
- Accumulated amortization	-750,000
4. Construction-in-progress	59,426,874,883
III. Investment property	0
Historical costs	0
Accumulated depreciation	0
IV. Long-term investments	5,000,000,000
1. Investments in affiliates	0
2. Investments in business concerns and joint ventures	5,000,000,000
3. Other long-term investments	0
4. Provisions for devaluation of long-term investments	0
V. Other long-term assets	14,294,424,621
1. Long-term prepaid expenses	0
2. Deferred income tax assets	0
3. Other long-term assets	14,294,424,621
VI. Goodwill
1. Goodwill
TOTAL ASSETS	178,275,482,641

LIABILITIES
A- LIABILITIES	158,275,482,641
I. Current liabilities	158,275,482,641
1. Short-term debts and loans	143,973,341,058
2. Payable to suppliers	8,487,926,591
3. Advances from customers	0
4. Taxes and other obligations to the State Budget	585,928,767
5. Payable to employees	1,523,275,517
6. Accrued expenses	74,332,442
7. Inter-company payable	0
8. Payable according to the progress of construction contracts	0
9. Other payable	3,630,678,266
10. Provisions for short-term accounts payable	0
II. Long-Term Liabilities	0
1. Long-term accounts payable to suppliers	0
2. Long-term inter-company payable	0
3. Other long-term payable	0
4. Long-term debts and loans	0
5. Deferred income tax payable	0
6. Provisions for unemployment allowances	0
7. Provisions for long-term accounts payable	0
B- OWNER’S EQUITY	20,000,000,000
I. OWNER’S EQUITY	20,000,000,000
1. Capital	20,000,000,000
2. Share premiums	0
3. Other sources of capital	0
4. Treasury stocks	0
5. Differences on asset revaluation	0
6. Foreign exchange differences	0
7. Business promotion fund	0
8. Financial reserved fund	0
9. Other funds	0
10. Retained earnings	0
11. Construction investment fund	0
II. Other sources and funds	0
1. Bonus and welfare funds	0
2. Sources of expenditure	0
3. Fund to form fixed assets	0
MINORITY’S INTEREST	0
TOTAL LIABILITIES AND OWNER’S EQUITY	178,275,482,641

PROFIT & LOSS STATEMENT

Description	FY2009
1. Total Sale	142,237,000,000
2. Deduction item	241,000,000
3. Net sale	141,996,000,000
4. Costs of goods sold	135,588,000,000
5. Gross profit	6,408,000,000
6. Financial income	-1,613,000,000
7. Financial expenses	3,815,000,000
- In which: Loan interest expenses	-
8. Selling expenses	-
9. Administrative overheads	-
10. Net operating profit	980,000,000
11. Other income	1,701,000,000
12. Other expenses	1,000,000
13. Other profit /(loss)	1,700,000,000
14. Total accounting profit before tax	2,680,000,000
15. Current corporate income tax	3,384,000,000
16. Deferred corporate income tax	0
17. Interest from subsidiaries/related companies	0
18. Profit after tax	2,010,000,000

FINANCIAL RATIOS AND AVERAGE INDUSTRY RATIOS

Description	FY2009	Average Industry
Current liquidity ratio	0.61	1.30
Quick liquidity ratio	0.60	0.68
Inventory circle	86.50	6.60
Average receive period	233.79	47.55
Utilizing asset performance	0.80	1.63
Liability by total asset	88.78	60.84
Liability by owner equity	791.38	157.24
Ebit / Total asset (ROA)	1.50	9.87
Ebit / Owner's equity (ROE)	13.40	29.99
Ebit / Total sale (NPM)	1.88	6.43
Gross profit / Total sale (GPM)	4.51	15.71
Note: The Average Industry was calculated by Vietnam Credit based on our owned statistical data

PAYMENT HISTORY & PERFORMANCE EXPERIENCES

Trade Morality		Fair
Liquidity		Medium
Payment status		Normal
Financial Situation		Above Average
Development trend		Positive
Litigation data		No Record
Bankruptcy		No Record
Payment Methods		L/C
Sale Methods		Wholesaler
Public opinion		Well-known

CREDIT INQUIRY: 125,000 USD, against DA in terms

Acceptable!

INTERPRETATION ON THE SCORES

The subject was established in 2009 with business registration certificate granted by Nghe An Department of Planning and Investment, subject focuses on processing milk, soya milk and other dairy products, drink fruit juice, trading in raw materials, machinery and equipment for production of milk and food business, cows cattle Breeding, agency and buying.

Subject has head office, factory and farm at Nghia Son Commune, Nghia Dan Dist., Nghe An Province. Subject has invested a breeding system and closed production process from planting grass, building cage, producing food for milking cow, processing and packaging… The subject imported milking cow, grass and equipment from foreign for the farm. Following the introduction of the subject company, the farm is technology transferred from Israel with modern technology. Lately, Mr. Shimon Peres, Israel’s president, has visit the subject company in official visit to Vietnam.

At present, the farm in Nghia Dan District has about 20,000 cows; it also has plan to expand the farm to other province in Vietnam. It is expected to have 137,000 cows and processing capacity will reach 500 million liters per year, meeting 50% demand of dairy products in the domestic market. Total planning investment is about USD 1.2 billion with the support from North Asia Bank.

According to the subject, it began production in the fourth quarter of 2010. And 26 Dec 2010, it officially introduced to the market dairy product: TH True Milk. It became more and more popular in the market and directly competes with Vinamilk – the current largest local milk producer.

In conclusion, subject has fairly large company scale in Vietnam in dairy products field. Subject has a bright future prospect with many practical projects and the subject has ability to meet all medium transactions.

APPENDIXES

INDUSTRY DATA

Industry code	Growth speed by price compared with 1994 (%)		Total enterprises 2009		Total employees 2010 (Thous.pers.)	Annual average capital of enterprises 2009 (billion dongs)
	2010	2009
Agriculture, Forestry and Fishing	2.78	1.82	8,749		23,896.3	81,559
Industry and Construction	7.70	5.52	85,115		10,630	2,751,975
Trade and Services	7.52	6.63	154,978		14,522	4,939,069

ECONOMIC INDICATORS

			2010	2009		2008
Population (Million person)			86.93	86.02		86.1
Gross Domestic Products (US$ billion)			102.2	91		84.9
GDP Growth (%)			6.78	5.32		6.2
GDP Per Capita (US$)			1,160	1,080		1,040
Inflation (% Change in Composite CPI)			11.75	6.88		24.4

SERVICE TRADE PERFORMANCE

Billion USD			2010	2009		2008
Exports			72.2	57.1		62.7
Imports			84.8	69.9		80.7
Trade Balance			-12.6	-12.8		-18

Source: General Statistics Office

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.51.65
UK Pound	1	Rs.81.06
Euro	1	Rs.69.51

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%)

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