MIRA INFORM REPORT

Report Date :

06.12.2011

IDENTIFICATION DETAILS

Name :	THANG LONG TOBACCO COMPANY LIMITED
Registered Office :	No.235 Nguyen Trai Str, Thanh Xuan District, Ha Noi City
Country :	Vietnam
Financials (as on) :	31.12.2010
Year of Establishment :	1996
Com. Reg. No.:	0104000336
Legal Form :	One Member Liability Limited Company
Line of Business :	Production and Trade of Cigarettes
No. of Employees :	958

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)
Vietnam	b1	b1

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	THANG LONG TOBACCO COMPANY LIMITED
Vietnamese Name	CONG TY TNHH MOT THANH VIEN THUOC LA THANG LONG
Short name	VINATABA THANG LONG
Type of Business	One member liability limited company
Year Established	1996
Establishment Decision	318/2005/QD-TTg (changed to one member liability limited company)
Date of Issuance	06 Dec 2005
Place of Issuance	Prime Minister
Business Registration No.	0104000336
Date of Registration	06 Jan 2006
Place of Registration	Hanoi Department of Planning and Investment
Current registered capital	196,002,000,000 VND
Status	Unlisted
Tax code	0100100054
Total Employees	958

Historical Identification & Legal form

List	Changed Items	Date of changes
1	Subject has got former Registered capital: 152,764,000,000 VND Changed to: 196,002,000,000 VND	N/A

ADDRESSES

Head Office
Address	No.235 Nguyen Trai Str, Thanh Xuan District, Ha Noi City, Vietnam
Telephone	(84-4) 3858 4342/3858 4441
Fax	(84-4) 3858 4344
Email	thanglongtobacco@vnn.vn

PARENT COMPANY

VIETNAM NATIONAL TOBACCO CORPORATION
Business Registration	0101216069
Date of Registration	18 Aug 2010
Place of Registration	Hanoi Planning and Investment Department
Registered Capital	1,602,000,000,000 VND
Tax code	0101216069
Address	25A Ly Thuong Kiet Str, Hoan Kiem District, Ha Noi City, Vietnam
Tel	(84-4) 3826 5778/ 38251381/ 39335536
Fax	(84-4) 3826 5777
Website	www.vinataba.com.vn

DIRECTORS

1. NAME	Mr. NGUYEN XUAN THUY
Position	Director
Nationality	Vietnamese
Note: Former director was Mr. DANG XUAN DUONG. Now he moves to VIETNAM NATIONAL TOBACCO CORPORATION
2. NAME	Ms. HOANG MINH HAI
Position	Deputy Director
Contact Address	No.235 Nguyen Trai Str, Thanh Xuan District, Ha Noi City, Vietnam
Nationality	Vietnamese
3. NAME	Mr. VU VAN THUONG
Position	Deputy Director
Contact Address	No.235 Nguyen Trai Str, Thanh Xuan District, Ha Noi City, Vietnam
Nationality	Vietnamese

BUSINESS NATURE AND ACTIVITIES

- Production and trade of cigarettes;
- Manufacturing and processing equipments for tobacco industry
- Trading guest houses, motels;
- Trading in food services; and real estate

IMPORT & EXPORT ACTIVITIES

IMPORT:
· Types of products	Materials
· Market	India, USA, Cambodia...
· Mode of payment	L/C, T/T
EXPORT:
· Types of products	Products
· Market	Europe, Africa, Southeast Asia, Middle East, Singapore
· Mode of payment	L/C, T/T

BANKERS

1. JOINT STOCK COMMERCIAL BANK FOR FOREIGN TRADE OF VIETNAM
Address	No. 198 Tran Quang Khai Street, Hoan Kiem District, Ha Noi City, Vietnam
Telephone	(84-4) 3934 3137 / (84-4) 3814 8919
Fax	(84-4) 3826 9067 / (84-4) 3825 1322
VND Account	1500311000003
2. VIETNAM TECHNOLOGICAL AND COMMERCIAL JOINT STOCK BANK DONG DO BRANCH
Address	No.1 Floor 18T1 Building, Trung Hoa-Nhan Chinh Urban, Thanh Xuan District, Ha Noi City, Vietnam
Telephone	(84-4) 6251 1032
Fax	(84-4) 6251 1035
3. VIET NAM BANK FOR AGRICULTURE AND RURAL DEVELOPMENT
Address	No.2 Lang Ha Street, Ba Dinh District, Ha Noi City, Vietnam
Telephone	(84-4) 37722771
Fax	(84-4) 37722379

SHAREHOLDERS

NAME	VIETNAM NATIONAL TOBACCO CORPORATION
Business Registration	0101216069
Date of Registration	18 Aug 2010
Place of Registration	Hanoi Planning and Investment Department
Registered Capital	1,602,000,000,000 VND
Tax code	0101216069
Address	25A Ly Thuong Kiet Str, Hoan Kiem District, Ha Noi City, Vietnam
Tel	(84-4) 3826 5778/ 38251381/ 39335536
Fax	(84-4) 3826 5777
Website	www.vinataba.com.vn
Percentage	100%

FINANCIAL DATA

BALANCE SHEET
Unit: Million VND
Balance sheet date	31/12/2010	31/12/2009	31/12/2008
Number of weeks	52	52	52
Status	(Unaudited)	(Unaudited)	(Unaudited)
ASSETS
A – CURRENT ASSETS	706,670	619,774	447,636
I. Cash and cash equivalents	72,438	45,988	71,438
1. Cash	72,438	45,988	71,438
2. Cash equivalents	0	0	0
II. Short-term investments	0	0	0
1. Short-term investments	0	0	0
2. Provisions for devaluation of short-term investments	0	0	0
III. Accounts receivable	120,227	170,360	130,737
1. Receivable from customers	98,928	135,503	118,186
2. Prepayments to suppliers	19,654	32,750	8,143
3. Inter-company receivable	0	0	0
4. Receivable according to the progress of construction	0	0	0
5. Other receivable	1,645	2,107	4,408
6. Provisions for bad debts	0	0	0
IV. Inventories	513,743	402,386	222,467
1. Inventories	517,647	405,430	226,337
2. Provisions for devaluation of inventories	-3,904	-3,044	-3,870
V. Other Current Assets	262	1,040	22,994
1. Short-term prepaid expenses	0	0	0
2. VAT to be deducted	7	0	0
3. Taxes and other accounts receivable from the State	0	908	2,281
4. Other current assets	255	132	20,713
B. LONG-TERM ASSETS	134,795	147,903	110,199
I. Long term account receivable	620	390	390
1. Long term account receivable from customers	0	0	0
2. Working capital in affiliates	0	0	0
3. Long-term inter-company receivable	0	0	0
4. Other long-term receivable	620	390	390
5. Provisions for bad debts from customers	0	0	0
II. Fixed assets	117,700	136,590	98,886
1. Tangible assets	63,677	94,256	61,000
- Historical costs	282,787	284,788	236,165
- Accumulated depreciation	-219,110	-190,532	-175,165
2. Financial leasehold assets	0	0	0
- Historical costs	0	0	0
- Accumulated depreciation	0	0	0
3. Intangible assets	0	0	0
- Initial costs	0	0	0
- Accumulated amortization	0	0	0
4. Construction-in-progress	54,023	42,334	37,886
III. Investment property	0	0	0
Historical costs	0	0	0
Accumulated depreciation	0	0	0
IV. Long-term investments	16,475	10,923	10,923
1. Investments in affiliates	0	0	0
2. Investments in business concerns and joint ventures	3,500	0	0
3. Other long-term investments	12,975	10,923	10,923
4. Provisions for devaluation of long-term investments	0	0	0
V. Other long-term assets	0	0	0
1. Long-term prepaid expenses	0	0	0
2. Deferred income tax assets	0	0	0
3. Other long-term assets	0	0	0
VI. Goodwill
1. Goodwill
TOTAL ASSETS	841,465	767,677	557,835
LIABILITIES
A- LIABILITIES	557,682	540,220	336,451
I. Current liabilities	555,629	538,594	334,649
1. Short-term debts and loans	47,433	223,446	105,754
2. Payable to suppliers	155,174	116,220	125,225
3. Advances from customers	12,941	523	3,856
4. Taxes and other obligations to the State Budget	158,303	89,221	65,801
5. Payable to employees	20,875	14,833	24,397
6. Accrued expenses	180	137	153
7. Inter-company payable	68,625	68,256	0
8. Payable according to the progress of construction contracts	81,533	0	0
9. Other payable	10,565	25,958	9,463
10. Provisions for short-term accounts payable	0	0	0
II. Long-Term Liabilities	2,053	1,626	1,802
1. Long-term accounts payable to suppliers	0	0	0
2. Long-term inter-company payable	0	0	0
3. Other long-term payable	12	12	12
4. Long-term debts and loans	0	0	0
5. Deferred income tax payable	0	0	0
6. Provisions for unemployment allowances	2,041	1,614	1,790
7. Provisions for long-term accounts payable	0	0	0
B- OWNER’S EQUITY	283,783	227,457	221,384
I. OWNER’S EQUITY	279,951	221,524	214,171
1. Capital	188,032	184,297	183,619
2. Share premiums	0	0	0
3. Other sources of capital	0	0	0
4. Treasury stocks	0	0	0
5. Differences on asset revaluation	0	0	0
6. Foreign exchange differences	1,057	-398	0
7. Business promotion fund	16,479	11,705	-4,345
8. Financial reserved fund	14,957	13,763	11,424
9. Other funds	100	200	100
10. Retained earnings	59,326	11,957	23,373
11. Construction investment fund	0	0	0
II. Other sources and funds	3,832	5,933	7,213
1. Bonus and welfare funds	3,832	5,933	7,213
2. Sources of expenditure	0	0	0
3. Fund to form fixed assets	0	0	0
MINORITY’S INTEREST	0	0	0
TOTAL LIABILITIES AND OWNER’S EQUITY	841,465	767,677	557,835

PROFIT & LOSS STATEMENT
Description	FY2010	FY2009	FY2008
1. Total Sale	2,978,187	2,103,130	1,516,943
2. Deduction item	979,866	664,683	491,197
3. Net sale	1,998,321	1,438,447	1,025,746
4. Costs of goods sold	1,813,836	1,365,605	925,138
5. Gross profit	184,485	72,842	100,608
6. Financial income	7,661	5,589	8,035
7. Financial expenses	24,747	11,197	5,654
- In which: Loan interest expenses	23,365	6,071	3,809
8. Selling expenses	57,425	61,829	53,565
9. Administrative overheads	41,526	27,401	29,015
10. Net operating profit	68,448	-21,996	20,409
11. Other income	10,278	37,411	9,881
12. Other expenses	139	52	133
13. Other profit /(loss)	10,139	37,359	9,748
14. Total accounting profit before tax	78,587	15,363	30,157
15. Current corporate income tax	19,248	3,407	6,803
16. Deferred corporate income tax	0	0	0
17. Interest from subsidiaries/related companies	0	0	0
18. Profit after tax	59,339	11,956	23,354

FINANCIAL RATIOS AND AVERAGE INDUSTRY RATIOS
Description	FY2010	FY2009	FY2008	Average Industry
Current liquidity ratio	1.27	1.15	1.34	1.94
Quick liquidity ratio	0.35	0.40	0.67	0.98
Inventory circle	3.96	3.39	4.16	9.29
Average receive period	21.96	43.23	46.52	54.01
Utilizing asset performance	2.37	1.87	1.84	2.21
Liability by total asset	66.28	70.37	60.31	58.72
Liability by owner equity	196.52	237.50	151.98	256.76
Ebit / Total asset (ROA)	12.12	2.79	6.09	7.90
Ebit / Owner's equity (ROE)	35.93	9.42	15.34	25.68
Ebit / Total sale (NPM)	3.42	1.02	2.24	4.18
Gross profit / Total sale (GPM)	6.19	3.46	6.63	15.30
Note: The Average Industry was calculated by Vietnam Credit based on our owned statistical data

PAYMENT HISTORY & PERFORMANCE

EXPERIENCES

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

CREDIT INQUIRY: 125,000 USD against D/A interns

Acceptance

INTERPRETATION ON THE SCORES

Precursor of the subject was a Thang Long tobacco factory state-owned enterprise, founded in 1996. After nearly 10 years operation, in 2005, the subject was converted to one member liability limited company under Decision No. 318/2005/QĐ-TTg of Prime Minister. From that time, the subject has name THANG LONG TOBACCO COMPANY LIMITED. The subject is directly managed by VIETNAM NATIONAL TOBACCO CORPORATION.

Head office is located at No. 235, Nguyen Trai Str, Thanh Xuan Dist, Hanoi City, Vietnam.
The premises and facilities of the subject are fairly good. The subject has a large business scale with 958 employees.

Financially, total assets were increased from VND 557,835 million in 2008 to VND 841,465 million in 2010. However, liabilities of the subject also were raised from VND 336,451 million to VND 557,682 million. As a result, liquidity ratios of the subject were not high. Moreover, rate of liabilities on total assets and owner equity still were maintained at high rate (66.28% and 196.52%), although these ratios were lower than that of year 2009. Other financial ratios of the subject are fairly good. Total sale in 2010 reached over VND 2,978 billion. This figure was grown nearly twice times comparison with year 2008 and higher than VND 875,057 against year 2009.

In general, the financial and operational bases of the subject are good. The subject has capacity to meet all normal financial commitments. Acceptance for credit inquiry as 125,000 USD against D/A in terms.

APPENDIXES 2

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.51.39
UK Pound	1	Rs.80.20
Euro	1	Rs.68.92

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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