MIRA INFORM REPORT

Report Date :

09.03.2011

IDENTIFICATION DETAILS

Name :	ESKE S.R.L.
Registered Office :	Victor Mantilla 237-245, Surquillo, Lima City
Country :	Peru
Financials (as on) :	30.11.2010
Date of Incorporation :	15.02.1999
Com. Reg. No.:	Electronic Entry 70208797
Legal Form :	Limited Liability Company
Line of Business :	Import and distribution of pharmaceuticals for human use

RATING & COMMENTS

MIRA’s Rating :

B

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

Maximum Credit Limit :	US$80,000
Status :	Moderate
Payment Behaviour :	Slow
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 – December 31, 2010

Country Name	Previous Rating (30.09.2010)	Current Rating (31.12.2010)
Peru	a2	a2

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

IDENTIFICATION

CORRECT COMPANY NAME	:	ESKE S.R.L.
TRADE NAME	:	"DROGUERIA ESKE S.R.L."
TAXPAYER REGISTRATION	:	RUC 20424721400
MAIN ADDRESS	:	Victor Mantilla 237-245, Surquillo
CITY	:	Lima
DEPARTMENT/STATE	:	Lima
COUNTRY	:	PERU
TELEPHONE	:	2413110 - 2413112 - 2614477
FAX	:	4464281
WEB SITE	:	www.eskegroup.com

COMMENTS .-

Other e-mail: gerencia@eskegroup.com

SUMMARY

INCORPORATION : 1999

LAST CAPITAL : S/.16,500,000.= Nuevos Soles

SHAREHOLDERS ' EQUITY : S/.11,053,397.= Nuevos Soles (as of 31/12/2006)

SALES : 0.00

EMPLOYEES : 110

PAYMENTS : P3 Delays but within sector norms

CHIEF EXECUTIVE : HURTADO PAZOS, MARCO ANTONIO

DISPOSITION : TOTAL (Full information and figures).

LEGAL BACKGROUNDS

LEGAL ESTATUS	:	Limited Liability Company
DATE OF INCORPORATION	:	15FEB1999
START OF OPERATIONS	:	08/04/1999
REGISTERED IN	:	Lima
NOTARY OFFICE	:	Juan Carlos Sotomayor Vitela
DURATION	:	Indefinite
REGISTRATION	:	Electronic Entry 70208797
INITIAL CAPITAL	:	S/.17,000.= Nuevos Soles
CURRENT PAID-IN CAPITAL	:	S/.16,500,000.= Nuevos Soles
LAST CAPITAL INCREASE	:	N/A
SHAREHOLDERS' EQUITY	:	S/.11,053,397.= Nuevos Soles (as of 31/12/2006)
TYPE OF SHARES	:	Interests
LISTED AT STOCK EXCHANGE	:	No
SHARE VALUE	:	S/.3.40 Nuevos Soles
CURRENT EXCHANGE RATE	:	S/.2.77 per 1.00 USADollar
MEMBERSHIP	:	Chamber of Commerce of Lima

COMMENTS .-

The General Manager acts as Legal Representative.

HiSTORY

The founders of the company were the gentlemen, Harish Kimar Vishindas Kimatral and Rohit Ratnakar Rao.

The company in investigation is part of the "ESKE GROUP", an international association that brings together important pharmaceutical companies from India associated with several companies operating in Latin America (Chile, Peru, Paraguay, Brazil, Ecuador, Argentina).

"ESKE GROUP" was founded in 1988 and is headquartered in Lima, Peru, dedicated to providing Latin America with pharmaceutical formulations, disposable medical devices and vaccines needed to promote health and wellbeing of people.

DIRECTORS / EXECUTIVES / SHAREHOLDERS

FULL NAMES / COMPANY NAME	TITLE	OWNERSHIP %
DIAZ LOZANO, HUGO ARMANDO	Board Members President
HURTADO PAZOS, MARCO ANTONIO	General Manager
CORONADO CHURA, DELIA	Finance Manager
MAKIHJA, MOHAN	Commercial Manager
TRIVIKRAM PATHAK, SWAPNIL	Operations Manager	1%
ALEMAN ALEMAN, MARCO	Accountant
RATNAKAR RAO, ROHIT	Member	99%

WHO IS WHO?

HURTADO PAZOS, MARCO ANTONIO

NATIONALITY : Peruvian

BORN : 14APR1957

DOC OF IDENT. : DNI 06755276

TAX ID : 10067552763

PROFESSION : Psychologist

Associated as per our database to :

Company	Position	Tax. Reg.	Country
DROGUERIA LABORATORIO BAXLEY GROUP S.A.C.	General Manager	20504587844	PERU
FALCON ENTERPRISE SAC	Manager/Legal Rep.	20502590309	PERU

CORONADO CHURA, DELIA

NATIONALITY : Peruvian

DOC OF IDENT. : DNI 07938085

Associated as per our database to :

Company	Position	Tax. Reg.	Country
DROGUERIA LABORATORIO BAXLEY GROUP S.A.C.	Finance Manager	20504587844	PERU

RATNAKAR RAO, ROHIT

NATIONALITY : Indian

BORN : 31OCT1964

DOC OF IDENT. : CE 111852

HOME ADDRESS : , San Borja

CIVIL STATUS : Married to Sylvia Carvajal Paez

BACKGROUND INFORMATION .-

Passport No. S-646085.

Represented in Peru by Marco Antonio Hurtado Pazos, according to Power registered under the Entry 11069386 at the Natural Persons Registry.

Associated as per our database to :

Company	Position	Tax. Reg.	Country
FALCON ENTERPRISE SAC	President	20502590309	PERU

RELATED COMPANIES TO SUBJECT COMPANY OR TO MAJORITY SHAREHOLDER

COMPANY NAME	COUNTRY	AX. REG.	RELATION
DROGUERIA Y BOTICAS BAXLEY GROUP S.A.	PERU		Related
ESKE (CHILE) LTDA.	CHILE		Related
ESKE GROUP S.A.	ECUADOR	0992336668001	Related
ESKE GRUPO IMPORTACAO E EXPORTACAO LTDA.	BRAZIL		Related
ESKE S.R.L.	ARGENTINA		Related
FALCON ENTERPRISE SAC	PERU	20502590309	Related

BUSINESS

MAIN ACTIVITY .-

Import and distribution of pharmaceuticals for human use, such as oncology, antiretrovirals, bronchodilators, Hepatitis-B vaccine, peptic ulcers and amino acids.

IMPORT : Yes

From Canada, China, India, Mexico and Thailand.

Annual Imports in US$ (CIF) :

Year Monto

2011 802,547.00

2010 2,992,287.00

2009 6,279,738.00

2008 5,490,688.00

2007 7,797,176.00

2006 5,437,811.00

2005 4,694,595.00

EXPORT : Yes

to Ecuador

Annual Exports in US$ (FOB) :

Year Monto

2010 10,500.00

2009 122,643.00

2008 141,974.00

2007 281,798.00

2006 25,437.00

2005 105,580.00

% CASH SALES/METHOD	:	50%
% CREDIT SALES/TERMS	:	50% (30 and 45-day payment terms)
% FOREIGN SALES (COUNTRIES)	:	5%
% DOMESTIC PURCHASES	:	10%
% FOREIGN PURCHASES	:	The General Manager acts as Legal Representative.
SELLING TERRITORY	:	95% - nationally
EMPLOYEES	:	105

LOCATION .-

Premises	:	Own
Monthly Amount	:	N/A
Time Occupied	:	N/A
Area	:	800 m2
Floors	:	3

Remarks and other Premises .-

In 2004, they acquired through a leasing transaction with Banco de Crédito (US$250,000), the premises contiguous to the headquarters, located at Jr. Victor Mantilla No.255, Surquillo, Lima 34.

Previously, the subject held tax domicile in the following address :

- Jr. Orbegoso 258, Breña/Lima,5 (Discontinued since 13/06/2002)

- Calle Manuel E. Di Vidaurre 198, Urb. La Colonial, Callao/Callao,1 (Discontinued since 09/05/2000)

- Jr. Lampa 879, Int. 312, Lima/Lima (Discontinued since 05/05/1999)

BUSINESS CENTERS:

- Jr. Victor Mantilla 251, Surquillo, Lima

- Av. Mansiche 795, Urb. Sanchez Carrión, Trujillo

- Av. Alberto Del Campo 421, Urb. Orrantia, Magdalena, Lima

- Av. Alfonso Ugarte 1470, Breña, Lima,21

- Av. Gral. Miguel Iglesias 968, San Juan de Miraflores, Lima

- Jr. Victor Mantilla 237, Surquillo, Lima

- Calle Flora Tristan 560, Urb. Orrantia, Magdalena, Lima

WAREHOUSES:

- Jr. Moreyra y Riglos 695, Pueblo Libre, Lima

- Jr. Victor Mantilla 245, Urb.del Médico, Surquillo (Lima,34)

COMMENTS .-

Products are traded through drugstores. They also supply to Government entities through public biddings.

The Company enjoys the franchise rights of APTECH (from India) and it is the only distributor in the country for the SERUM INSTITUTE OF INDIA LTD., CIPLA LTD. (India), TABLET (India), MEGA (Thailand).

FINANCIAL INFORMATION

Interviewee(s)	:	Marco Alemán
Position(s)	:	General Accountant
Cooperation	:	TOTAL (Full information and figures).
Information Provided	:	On this occasion, Mr. Marco Alemán Alemán (General Accountant) confirmed, revised and increased trade information. With regard to the financial statements, he gave us key figures of the Balance Sheet dated 30/11/2010 (11 months), expressed in Nuevo Sol. He added that Dr. Hugo Diaz Lozano serves as Chairman of the Board of Partners. At same time we turned to various independent sources of information where we found some additional information of interest regarding this enterprise.

INTERIM BALANCE SHEET

BALANCE SHEET DATE	30NOV2010
PERIOD	11 months
EXCHANGE RATE PER US$	2.83
CURRENCY	Nuevos Soles
ASSETS
TOTAL CURRENT	40,233,000.00
FIXED	21,393,000.00
TOTAL ASSETS	61,626,000.00
LIABILITIES
TOTAL CURRENT	26,574,000.00
LONG TERM	7,240,000.00
SHAREHOLDERS' EQUITY
TOTAL EQUITY	27,812,000.00
TOTAL LIABILITIES	61,626,000.00
SALES	42,316,000.00
PROFIT(LOSS)	1,101,000.00

RATIO

LIQUIDITY RATIO	1.51	(Current Assets/Current Liabilities)
DEBT-TO-EQUITY RATIO	104.66	(Shareholders's equity/Current Liabilities %)
PROFITABILITY MARGIN	2.60	(Profits/Sales %)
WORKING CAPITAL	13,659,000.00	(Current Assets - Current Liabilities)

FINANCIAL SITUATION : Active

According to its latest financial statements submitted (30/11/2010) , we estimate the financial situation of the investigated company as Satisfactory , because it shows an adequate above-average liquidity ratio. Its working capital is positive and allows for an orderly payment performance. Debt/equity ratio is acceptable. The economic results have been satisfactory.

We note that in business circles the subject shows a correct payment behaviour concerning its obligations to local suppliers, however, through other consultation sources we know that it had deficiencies during the years 2008 - 2009 (protests mostly settled by now)

Further, according to the latest report given by the Superintendency of Banking and Insurance at 31/12/2010, the company under investigation would have received this rating: 42.83%% NORMAL, 57.17% POTENTIAL PROBLEM.

INSURANCE .-

Company	Againts	Amount	Expiration
EL PACIFICO PERUANO-SUIZA CIA. DE SEGURO	General risks	N.A.	N.A.

PAYMENTS RECORD

TRADE REFERENCES .-

Supplier	Country	Tel.	Line of Credit	Monthly Average	Terms(days)	Perfomance?	Time	Products/Services
Laboratorios Portugal SRL	PERU	(5154) 251292	Open	N.A.	draft 90 days	Prompt	No longe	Generic medicines, creams, toiletries
Laboratorios Induquímica S.A.	PERU	(511) 6176000	S/. 250,000.=	N.A.	draft 60 days	Prompt	No longe	Pharmaceuticals
Tecnoimagen del Perú S.A	PERU	(511) 4440635	US$ 25,000.=	N.A.	Invoice 30,60 days	Prompt	5 years	Films
Disfroza S.R.L	PERU	(511) 4636040	Open	S/. 20,000.=	draft 60 days	Prompt	10 yrs.	Medicines.
Agentes y Asesores Integrales en Aduana S.A.	PERU	(511) 6147200	N.A.	N/A	120 days	Prompt	8 months	Customs service
Ramsey Ag. Ad.	PERU	(511) 4616255	N.A.	varying amounts	draft 30, 160 days	Prompt	5 yrs.	Customs service
New World Aduanas S.A.C.	PERU	(511) 4842313	N/A	N.A.	Cash	No experience	No longe	Customs service

NOTE: Other Suppliers did not provide information or could not be consulted.

Supplier	Country	Tel.
Manufacturas y Papeles y Cartones S.A.	PERU	(511) 6852041
Savar Agente de Aduanas SA	PERU	(511) 6137070
Terra Aduanera SAC	PERU	(511) 4537906
Agencia de Aduana Transoceanica SA	PERU	(511) 4653196
Tecnologia en Servicios Ag. de Aduana SA	PERU	(511) 2224210
Editoria R Imagenes SAC	PERU	(511) 2411178
Laboratorio Disploza S.A.C.	PERU	N/A
Laboratorios Trifarma S.A.	PERU	N/A
Gen Far Perú S.A.	PERU	N/A
Fami Care Ltda.	INDIA	N/A
Lupin Limited	INDIA	N/A
Cipla Ltda.	INDIA	N/A
Sun Pharmaceutical Ind. Ltda.	INDIA	N/A
Instituto Biologico Argentino Salc	ARGENTINA	N/A
Kirloskar Brothers Ltda.	INDIA	N/A
Wockhard Limited	INDIA	N/A
USP The Standard of Quality The United States	U.S.A.	N/A
Praxair Perú S.R.L.	PERU	(511) 5172300
Medrock Corporation S.A.C.	PERU	(511) 2614477
Agencia de Aduana J y N Asociados S.A.	PERU	(511) 5151099
Ramsey S.A. Agente de Aduana S.A.	PERU	(511) 4616255
Aduanera Capricornio S.A.	PERU	(511) 4202022
ADM Aduanas S.A.C.	PERU	(511) 6147272

COMMENTS .-

In the company ADM ADUANA S.A., were told that carried out two customs operations with the investigated company. The Scotiabank granted a line for the customer to U.S.$ 20,000 .= for discounted drafts. The subject paid all drafts on the agreed date.

Besides, we have asked other local suppliers but they haven't answered us back yet and / or declined to provide references.

CREDIT RISK CENTRAL .-

The subject is reported a total of 337 protested documents from 2008 to 2009, of which 2 are listed as "not solved" and corresponded to the year 2009 for amounts of U.S.$772 .= and S/.1,191 .=

NOTE It should be noted that until due clarification is made to the respective chamber of commerce, a document may remain listed as "not solved".

Subject delinquency with America Movil Peru (Claro) for S/.45.80 for a due period (03/04/2010).

On the other hand, the company under investigation is not reported closed accounts, credit cards canceled, delayed tax and pension debts.

CREDIT HISTORY

BANKING INFORMATION

BANKERS .-

Bank	Contact	Telephone	Account #	DC (S/.)	FC (US$)
BANCO DE CREDITO DEL PERU	N/A	N/A	N/A	N/A	N/A
BANCO SCOTIABANK	N/A	N/A	N/A	N/A	N/A
BANCO FINANCIERO	N/A	N/A	N/A	N/A	N/A
BANCO DE COMERCIO	N/A	N/A	N/A	N/A	N/A
INTERAMERICANO DE FINANZAS	N/A	N/A	N/A	N/A	N/A
BBVA BANCO CONTINENTAL	N/A	N/A	N/A	N/A	N/A
HSBC BANK PERU	N/A	N/A	N/A	N/A	N/A

Subject Company is a client of the aforesaid banks. No more details were givne due to privacy policy.

However, other reference sources indicate it makes heavy use of banking facilities.

Debt structure for Bank (Domestic Currency)

Bank	NORMAL	PROBLEM POTENTIAL	DEFICIENT	DOUBTFUL	LOSS	Current Debt DC	Current Debt FC
B. CREDITO		100				12766038	0
B. FINANCIERO	100					3390542	0
B. SCOTIABANK	100					3050247	0
B. CONTINENTAL	100					2569929	0
B. COMERCIO	100					606767	0
B. HSBC BANK PERU	100					4088	0
B. BIF	100					104	0

RATING DESCRIPTION ACCORDING TO THE SBS

Normal .- Good Financial Situation, Prompt payments, consistent Information, Increasing Trend, Creditworthy.

Problem Potential .- Satisfactory Financial Situation but cash flow can be weak. Irregular payments. Irregular Trend.

Deficient .-Financial Situation, cash problems, profits shortage, delayed and overdue payments.

Doubtful .- Heavy Financial Situation, liquidity shortage, notorious delayed payments, Judicial Collection, Bad Management.

Loss .- Bad Financial Situation, Insufficient funds, declared bankruptcy,debt default.

CREDIT OPINION

Consulted Credit Amount : MAXIMUM

Subject Company is eligible for a credit line of US$80,000.=

NOTE: The Opinion given is confidential referential and with out liability

Press Releases

Hugo Díaz Lozano, since 2006, is winning lucrative contracts for sale of medicines to the State. This year has billed 20 million Nuevos Soles, although Essalud has fined him by the poor condition of his products.

During the 2006 presidential campaign was common to see the then candidate Alan Garcia inaugurating the popular "Boticas del Pueblo" (drugstores), a private initiative of APRA's political party doctor Hugo Díaz Lozano, who allowed García for in each opening to launch his promise to improve health service and the delivery of medicines to the insured with Essalud. With this offer, the candidate Garcia managed to earn a good amount of votes that helped him win the presidency a second time.

The "Boticas del Pueblo" were not as successful as Garcia, as most of these do not currently work. However, their creator, the doctor Hugo Díaz Lozano, who according to various sources is also pediatrician of Garcia's son, Federico Danton García Chessman, the last son of our president, got his company Eske SRL to become overnight in the main provider of medical equipment and medicine to the State, say sources of the Ministry of Health.

According to the ranking of suppliers to Essalud, Eske SRL is the only company that has progressively increased its sales in the last three years, exactly from the second half of 2006, when Garcia was installed at the Government Palace, until now. Indeed, according to Electronic System of the State Procurement and Contracting (SEAC), in all of 2005, Eske SRL barely managed to sell a million Nuevos Soles in medicines to the state. But in 2006, the fortunes improved for Diaz Lozano because his company was awarded lucrative contracts and billed over 28 million Nuevos Soles in sales to the State, while between 2007 and 2008 its sales exceeded 35 million Nuevos Soles, and so far this year the government is buying to Eske S.R.L. about 20 million Soles. However, the meteoric rise of the doctor's company, that other laboratories and drug dealers would also like to have experienced this season despite the crisis, does not keep relation with the amount of fines and penalties being applied by Essalud to him repeatedly for selling the social security system bad-quality products, most of Indian origin.

According to a study conducted in 2007 by the Environmental Health Department (Digesa) on various products purchased by Essalud from Eske SRL proved to be of the poorest quality. These deficiencies led the company to lead another ranking, of the penalties imposed by Essalud, which it holds until today. The aforementioned study notes, for example, that the company of the creator of the "Botica del Pueblo" sold to the state a product called Ivepred 500, prescribed to treat respiratory problems like asthma, which showed foreign particles, which is why Digesa ordered tosuspend its distribution and to collect the lot of this medicine from the market for immediate destruction.

It was also found that the Novapime provided by Eske SRL, an antibiotic in powder for injectable solutions presented sterility failures. Therefore it wasordered to suspend its distribution and collect the lot of this medicine from the market for destruction. Similarly, Digesa established that Ethambutol, a drug intended to treat various forms of tuberculosis, did not meet the requirements for distribution to patients. Another product that had problems and even merited a congressional investigation is the Oralcon-F, an emergency oral contraception which was restrained until the company had remedied the deficiencies.

These were just some cases found in 2007 that earned Eske SRL heavy fines. However, despite this background, the company of the pediatrician of last son of President Garcia continued to be favored with more and more contracts. Worst of all is that Eske SRL has relapsed into its faults.

"LA PRIMERA" consulted registration penalties for Eske SRL in 2008 and 2009, and found that in that short period the company has again been punished with fines for S/.874,486.= Nuevos soles, according to informants consulted, have not been paid by the company of the physician Lozano Díaz. Despite all this Essalud is still buying drugs from him that endanger the health of millions of insured people.

All fines of Eske SRL

LA PRIMERA reviewed in detail the ranking of fines by Essalud and found that among the largest fines received by the company is that of January 17, 2008, when it was fined by S/. 31,938 Soles per deficiencies in medical supplies.

On February 6, 2008 it was fined again by S/.21,202 by the poor state of its medicines. On June 6, 2008 was forced to pay S/. 106,934.= Soles for more drugs in poor condition. On August 19, 2008 was fined with S/. 26,530 soles for its bad medicines. On September 15, 2008 another penalty, this time of S/. 30,431 Soles was imposed to it. On December 3, 2008 received a fine for S/. 20,593 Soles. In year 2009 continued to receive fines. In total, the fines to Eske SRL between 2008 and 2009 amounted to S/. 874,486 Soles for selling bad products to the State.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.45.03
UK Pound	1	Rs.72.98
Euro	1	Rs.62.94

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

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