MIRA INFORM REPORT

Report Date :

17.06.2011

IDENTIFICATION DETAILS

Name :	COLGATE-PALMOLIVE (CHINA) CO., LTD.
Registered Office :	17/F, Yuehai Tianhecheng Building, No. 208, Tianhe Road, Guangzhou City, Guangdong Province 510620 Pr
Country :	China
Financials (as on) :	31.12.2009
Date of Incorporation :	24.11.1995
Com. Reg. No.:	440108400006386
Legal Form :	Wholly Foreign-Owned Enterprise
Line of Business :	manufacturing and selling oral care, home care and personal care products, 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 1,500,000
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 – 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

Bottom of Form

Company name & address

COLGATE-PALMOLIVE (CHINA) CO., LTD.

17/F, YUEHAI TIANHECHENG BUILDING, NO. 208, TIANHE ROAD,

GUANGZHOU CITY, GUANGDONG PROVINCE 510620 PR CHINA

TEL: 86 (0) 20-85101888 FAX: N/A

EXECUTIVE SUMMARY

INCORPORATION DATE : Nov. 24, 1995

REGISTRATION NO. : 440108400006386

REGISTERED LEGAL FORM : WHOLLY FOREIGN-OWNED ENTERPRISE

CHIEF EXECUTIVE : MR. CHESTER P.W.FONG (LEGAL REPRESENTATIVE)

STAFF STRENGTH : 2,300

REGISTERED CAPITAL : USD 45,000,000

BUSINESS LINE : MANUFACTURE

TURNOVER : CNY 2,729,539,000 (AS OF DEC. 31, 2009)

EQUITIES : CNY 332,224,000 (AS OF DEC. 31, 2009)

PAYMENT : AVERAGE

RECOMM. CREDIT RANGE : UP TO USD 1,500,000 (periodical review)

MARKET CONDITION : competitive

FINANCIAL CONDITION : fairLY STABLE

OPERATIONAL TREND : steady

GENERAL REPUTATION : WELL-KNOWN

EXCHANGE RATE : CNY 6.48 = USD 1

Adopted abbreviations

ANS - amount not stated

NS - not stated

SC - subject company (the company inquired by you)

NA - not available

CNY - China Yuan Renminbi

SC was registered as a wholly foreign-owned enterprise at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on Nov. 24, 1995.

Company Status: Wholly foreign-owned enterprise

This form of business in PR China is defined as a legal person. It is a limited co. established within the territories of PR China with capital provided totally by the foreign investors. More than one foreign investor may jointly invest in a wholly foreign-owned enterprise. The investing party/parties solely exercise management, reap profit and bear risks and liabilities by themselves. This form of companies usually have a limited duration is extendible upon approval of Examination and Approval Authorities.

SC’s registered business scope includes R&D, manufacturing and processing toothpaste, oral hygiene products, household cleaning products, fabric protection products, personal care products, pet food, pet care products and related raw materials, packaging materials, and manufacturing and processing placing these promotional products, commission processing and marketing of Colgate Palmolive Company's other investments in China, products and domestic production and processing enterprises Colgate Palmolive Company's trademark products in the domestic exports of non-quota license acquisition of goods, and the similar products in the wholesale, commission agency (excluding auction), import and export related services (no shop operators involved in the quota license management, special provisions of the management of goods by the relevant national regulations); providing warehousing (inflammable, explosive, dangerous chemical goods), management consulting related services. Engaged in printing packaging materials (printing business license is valid until December 31, 2013); medical device products, wholesale, commission agency (excluding auction), import and export business and related support services (in Medical Device Distribution Enterprise License Licence Scope, permit valid until 14 October 2013, no shop operators involved in the management industry by state licensing regulations, these products do not involve state-owned import and export trade, import and export quota license, export quota bidding, the export Permits and other special management products).

SC is mainly engaged in manufacturing and selling oral care, home care and personal care products, etc.

Mr. Chester P.W.Fong has been legal representative and chairman of SC since 1995.

SC is known to have approx. 2,300 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office in the commercial zone of Guangzhou. SC’s management refused to release the detailed information of the premise.

Note: SC’s factory is located in No. 338, Qingnian Road, Economy and Technology Development Zone, Guangzhou City, Guangdong Province.

http://www.colgate.com The design is professional and the content is well organized. At present it is in both Chinese and English versions.

Changes of its registered information:

Date of change	Item	Before the change	After the change
2006-12-18	Registered capital	USD 30,000,000	Present amount
2010-5-28	Registration No.	100125	Present one

MAIN SHAREHOLDERS:

Name % of Shareholding

Colgate (B.V.I.) Ltd. 16.67

Colgate-Palmolive (H.K.) Limited 83.33

Colgate-Palmolive (H.K.) Limited

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

CR No.: 0005249

Date of Incorporation: 7-OCT-1958

Company Status: Private

Active Status: Live

l Legal representative and chairman:

Mr. Chester P.W.Fong, Canadian, born in 1956, he is currently responsible for the overall management of SC.

Working Experience(s):

From 1995 to present Working in SC as legal representative and chairman.

Also working in Colgate (Guangzhou) Co., Ltd. as legal representative and chairman.

SC is mainly engaged in manufacturing and selling oral care, home care and personal care products, etc.

SC’s products mainly include toothbrush mouthwash, laundry detergent, Shampoo, etc.

SC’s brand: Colgate.

SC sources its materials 90% from domestic market, 10% from overseas market. SC sells 90% of its products in domestic market, and 10% to overseas market.

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

Major supplier:

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

Colgate (Guangzhou) Co., Ltd.

Major client:

==========

Hawley & Hazel Chemical Co. (ZS) Ltd.

Colgate (Guangzhou) Co., Ltd.

Colgate Sanxiao Co., Ltd.

Etc.

SC is known to have the following branch:

Colgate-Palmolive (China) Co., Ltd. Guangzhou Branch

Overall pament appraisal:

( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet 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 records and our debt collection record concerning SC.

Trade payment experience: SC refused to release any information of its suppliers and the trade reference was not available.

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.

Bank of China Guangzhou Zhujiang Sub-branch

AC#：8020-05523008092014

Relationship: Normal.

SC’s management declined to release whether it has account in Citibank (China) Co. Ltd.

Balance Sheet

Unit: CNY’000

	as of Dec. 31, 2009	as of Dec. 31, 2008
Cash & bank	2,445	21,969
Notes receivable	0	0
Inventory	210,906	228,007
Accounts receivable	257,742	300,806
Advances to supplies	20,993	18,836
Other receivables	13,068	9,843
Prepaid expenses	0	283
Other current assets	0	0
	-----------------	------------------
Current assets	505,154	579,744
Fixed assets net value	643,027	648,749
Projects under construction	8,548	69,413
Improved operating lease of fixed assets	5,059	6,580
Long-term investments	0	0
Intangible assets	362	397
Other assets	0	0
	------------------	------------------
Total assets	1,162,150	1,304,883
	=============	=============
Short loans	61,429	310,772
Accounts payable	246,228	216,564
Notes payable	13,568	53,978
Advances from customers	3,493	2,464
Accrued payroll	7,202	6,566
Welfares payable	6,122	5,882
Interest payable	0	0
Taxes payable	24,497	18,155
Other accounts payable	83,095	92,331
Withholding expenses	384,292	287,770
Other current liabilities	0	0
	------------------	------------------
Current liabilities	829,926	994,482
Long term liabilities	0	0
	------------------	------------------
Total liabilities	829,926	994,482
Shareholders equities	332,224	310,401
	------------------	------------------
Total liabilities & equities	1,162,150	1,304,883
	=============	=============

Income Statement

Unit: CNY’000

	as of Dec. 31, 2009	as of Dec. 31, 2008
Turnover	2,729,539	2,811,763
Cost of goods sold	1,552,706	1,702,452
Income from other operations	2,589	1,919
Sales expense	901,651	894,561
Management expense	246,377	173,531
Finance expense	9,812	13,772
Asset impairment loss	0	0
Investment income	0	0
Non-operating income	2,719	5,952
Non-operating expense	2,477	5,334
Subsidy income	0	0
Operation Profit	21,824	29,984
Less: profit tax	0	0
Net profit	21,824	29,984

Important Ratios

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

	as of Dec. 31, 2009	as of Dec. 31, 2008
*Current ratio	0.61	0.58
*Quick ratio	0.35	0.35
*Liabilities to assets	0.71	0.76
*Net profit margin (%)	0.80	1.07
*Return on total assets (%)	1.88	2.30
*Inventory /Turnover ×365	29 days	30 days
*Accounts receivable/Turnover ×365	35 days	40 days
*Turnover/Total assets	2.35	2.15
* Cost of goods sold/Turnover	0.57	0.61

PROFITABILITY: AVERAGE

l The turnover of SC appears good in its line.

l SC’s net profit margin appears average.

l SC’s return on total assets appears average.

l SC’s cost of goods sold is low, comparing with its turnover.

LIQUIDITY: FAIR

l The current ratio of SC is maintained in a fair level.

l SC’s quick ratio is maintained in a poor level.

l SC’s inventory appears fairly large in both years.

l SC’s accounts receivable appears fairly large in both years.

l SC’s short-term loan appears large in 2008 and average in 2009.

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

LEVERAGE: AVERAGE

l The debt ratio of SC is fairly high in 2008 and average in 2009.

l The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly stable

SC is considered large-sized in its line with fairly stable financial conditions. The large amount of inventory and accounts receivable could be a threat to SC’s financial condition. In view of its favorable background and market conditions, the given credit amount would appear to be within SC’s capacities.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.90
UK Pound	1	Rs.72.54
Euro	1	Rs.63.39

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.