MIRA INFORM REPORT

Report Date :

10.05.2011

IDENTIFICATION DETAILS

Name :	MEGACHIPS CORPORATION

Registered Office :	4-1-6 Miyahara Yodogawaku Osaka 532-0003

Country :	Japan

Financials (as on) :	31.03.2011

Year of Establishment :	1990

Legal Form :	Private Company

Line of Business :	Manufacturer (fabless) of customer specific system LSIs

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	Yen 2,159.5 Million
Status :	Satisfactory
Payment Behaviour :	Regular
Litigation :	----

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)

Japan

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

Company name

MEGACHIPS CORPORATION

REGD NAME

KK Megachips

MAIN OFFICE

4-1-6 Miyahara Yodogawaku Osaka 532-0003 JAPAN

Tel: 06-6399-2884 Fax: 06-6399-2886-

URL: http://www.megachips.co.jp

E-Mail address: info@megachips.co.jp

ACTIVITIES

Mfg (fabless) of customer specific system LSIs

BRANCHES

Tokyo; Taiwan

FACTORIES

(subcontracted)

CHIEF EXEC

YUKIHIRO UKAI, PRES

Yen Amount: In million Yen, unless otherwise stated

SUMMARY

FINANCES FAIR 　A/SALES Yen 36,259 M

PAYMENTS REGULAR 　CAPITAL Yen 4,840 M

TREND SLOW 　WORTH Yen 25,453 M

STARTED 1990 　EMPLOYES 270

COMMENT

FABLESS MFR OF SYSTEM LSIS & ELECTRONIC DEVICES

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR CREDIT ENGAGEMENTS: US$125,000 / O/A 60 DAYS.

MAX CREDIT LIMIT: YEN 2,159.5 MILLION, 30 DAYS NORMAL TERMS

FINANCES

(In Million Yen)

FINANCES: (Consolidated in million yen)
			Terms Ending:		31/03/2011	31/03/2010
INCOME STATEMENT
	Annual Sales				36,259	38,495
	Cost of Sales				29,731	31,833
	GROSS PROFIT				6,528	6,662
	Selling & Adm Costs				3,472	3,627
	OPERATING PROFIT				3,055	3,034
	Non-Operating P/L				265	67
	RECURRING PROFIT				3,320	3,101
	NET PROFIT				2,288	2,140
BALANCE SHEET
	Cash				7,503	6,585
	Receivables				15,159	11,875
	Inventory				636	945
	Securities, Marketable
	Other Current Assets				447	598
	TOTAL CURRENT ASSETS				23,745	20,003
	Property & Equipment				108	110
	Intangibles				63	75
	Investments, Other Fixed Assets				5,287	6,424
	TOTAL ASSETS				29,203	26,612
	Payables				1,987	1,435
	Short-Term Bank Loans

	Other Current Liabs				1,718	699
	TOTAL CURRENT LIABS				3,705	2,134
	Debentures
	Long-Term Bank Loans
	Reserve for Retirement Allw
	Other Debts				44	38
	TOTAL LIABILITIES				3,749	2,172
	MINORITY INTERESTS
	Common stock				4,840	4,840
	Additional paid-in capital				6,181	6,181
	Retained earnings				12,536	11,380
	Evaluation p/l on investments/securities				2,326	2,451
	Others				(385)	(322)
	Treasury stock, at cost				(45)	(91)
	TOTAL S/HOLDERS` EQUITY				25,453	24,439
	TOTAL EQUITIES				29,202	26,611
CONSOLIDATED CASH FLOWS
				Terms ending:	31/03/2011	31/03/2010
	Cash Flows from Operating Activities				1,761	-431
	Cash Flows from Investment Activities				381	358
	Cash Flows from Financing Activities				-1,080	-7,701
	Cash, Bank Deposits at the Term End				7,503	6,485
ANALYTICAL RATIOS Terms ending:					31/03/2011	31/03/2010
		Net Worth (S/Holders' Equity)			25,453	24,439
		Current Ratio (%)			640.89	937.35
		Net Worth Ratio (%)			87.16	91.84
		Recurring Profit Ratio (%)			9.16	8.06
		Net Profit Ratio (%)			6.31	5.56
		Return On Equity (%)			8.99	8.76

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.44.70
UK Pound	1	Rs.73.23
Euro	1	Rs.64.43

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.