MIRA INFORM REPORT

Report Date :

18.05.2011

IDENTIFICATION DETAILS

Name :	YG-1 CO., LTD.
Formerly Known As :	YANGGEE 1 TOOLS CO., LTD.
Registered Office :	68, Cheongcheon 1-dong, Bupyeong-gu, Incheon, Korea, Zip Code 403-855
Country :	South Korea
Financials (as on) :	31.03.2011
Date of Incorporation :	25.09.1986
Com. Reg. No.:	122-81-16515
Legal Form :	Listed Company
Line of Business :	Manufacture of Saws, Saw Blades and Interchangeable Tools

RATING & COMMENTS

MIRA’s Rating :

B

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

Status :	Moderate
Payment Behaviour :	Unknown
Litigation :	Exists

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)
South Korea	a1	a1

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

Bottom of Form

Basic

Company Name	YG-1 CO., LTD. (Korean Company Name : “(주)와이지-원”)
Registered Address	68, Cheongcheon 1-dong, Bupyeong-gu, Incheon, Korea
Zip Code	403-855
Tel	+82-32-526-0909
Fax	+82-32-526-4373
E-mail	yg-1@yg1.co.kr
Website	www.yg1.co.kr
Trading Address	68, Cheongcheon 1-dong, Bupyeong-gu, Incheon, Korea
Tel	+82-32-526-0909
Fax	+82-32-526-4373
Other Address-Ansan Factory	5Ra-403, Sihwa Industrial Complex, 673-15, Seonggok-dong, Danwon-gu, Ansan-si, Gyeonggi-do, Korea
Tel	+82-31-499-9541~5
Fax	+82-31-498-7971
Other Address-Gwangju Factory	621-4, Docheon-dong, Gwangsan-gu, Gwangju, Korea
Tel	+82-62-951-9212
Fax	+82-62-951-9222
Other Address-R&D Center	7-7, Songdo-dong, Yeonsu-gu, Incheon, Korea
Tel	+82-32-858-0919~21
Fax	+82-32-858-0922
Type	Export
Industry	Manufacture of Saws, Saw Blades and Interchangeable Tools
Main Business	End Mill, Drill, Tap, Rotary Burr
Established (mm/dd/yyyy)	09/25/1986

The Subject owns the premises of registered HQ address, Ansan Factory and Gwangju Factory.

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Taps or dies(23153305)
Sell	Drills(23153301)
Sell	End mills(27112803)
Sell	Rotary burrs(23153310)
Buy	Tungsten carbide(31191518)
Buy	Steel(11101704)

CEO’s

Name	Song Ho-Keun
Date of Birth	01/15/1952
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

10,806,615,000

Employees

890

Formation

Listed Company (KOSDAQ : 019210) as of 08/06/1997

Bank Details

Citibank, Korea

SC First Bank of Korea

Woori Bank

Corporate Registered No.

120111-0038639

Business Registered No.

122-81-16515

Permit & Licenses

06/1993 KS Mark

03/1997 EM Mark

03/31/1997 KS Mark

12/28/1999 ISO 9001 by TUV

07/2001 ISO 14001 by TUV

03/2005 ISO 9001 by DAS

03/2005 ISO 14001 by DAS

Int’l Trade No.: 960975

Shareholder Position

Name	Shares	%
SONG HO-KEUN	9,672,178	44.75
SEI ASSET KOREA CO., LTD.(110111-0563208)	695,036	3.22
SHIN SOOK-HEE	205,620	0.95
SONG SI-HAN	284,195	1.31
SONG JI-HAN	284,139	1.31
SONG JU-RI	149,082	0.69
OTHERS	10,322,980	47.76
TOTAL	21,613,230	100.00

Company History

09/25/1986 Incorporated as YANGGEE 1 TOOLS CO., LTD.

10/12/1999 Changed company name to the present name

11/2001 Awarded US$30 Million Export Top Prize

07/2004 Moved to the present HQ address from 378, Cheongcheon-dong, Bupyeong-gu, Incheon, Korea

11/2004 Awarded US$50 Million Export Top Prize

11/2006 Awarded US$70 Million Export Top Prize

11/2008 Awarded US$100 Million Export Top Prize

02/28/2009 Acquired the patent on spherical tools in India

Management

Job Description	Title	Name	Nationality	Date of Birth	Education
President & CEO	Mr.	Song Ho-Keun	Korean	1952.01.15	Seoul National University, Korea
Director / R&D	Mr.	Lee Young-Bae	Korean	1951.03.10	Dongah University, Korea
Director	Mr.	Park Young-Koon	Korean	1958.01.27	Gyungnam University, Korea
Outside Director	Mr.	Kim Jong-Hoon	Korean	1953.03.08	Seoul National University, Korea
Auditor	Mr.	Lee Ho-Kil	Korean	1950.06.29	Seoul National University, Korea

Financials

Year / Unit : KRW	Sales	Assets	Net Income
(*)03/2011	51,308,674,932	326,608,663,318	2,423,889,231
2010	163,176,034,832	208,141,615,879	10,667,567,876
2009	115,507,427,989	190,838,235,591	-14,645,488,980
2008	174,829,352,201	177,677,235,137	7,670,371,069
2007	128,278,571,018	142,713,220,376	9,865,338,204
2006	105,483,007,771	119,862,120,219	7,231,213,257
2005	107,731,920,082	112,822,917,787	6,130,343,517

(*)03/2011 ‘s figures are based on the K-IFRS Accounting System.

Financial Description

Authorized Capital(KRW)	20,000,000,000
Paid-Up Capital(KRW)	10,806,615,000
Total Issues Shares	21,613,230

Balance Sheet
Unit : Korean Won	01/01/2011~03/31/2011	As of 12/31/2010	As of 12/31/2009
Total Assets	326,608,663,318	301,980,398,433
Current Assets	185,607,411,664	165,693,840,446
Cash & Cash Equivalents	5,797,889,424	2,690,852,419
Deposits	10,967,040,000	10,968,230,000
Trade Receivables & Other Receivables	85,654,473,842	77,989,550,992
Current Financial Instruments	6,585,000	6,065,000
Inventories	76,603,931,312	68,852,329,549
Other Current Assets	6,577,492,086	5,186,812,486
Non-Current Assets	141,001,251,654	136,286,557,987
Deposits	622,830,100	522,547,090
Investment_Subsidiaries	44,817,617,708	41,414,117,708
Marketable Financial Instruments	391,948,361	391,948,361
Other Financial Instruments	226,455,000	55,170,000
Trade Receivables & Other Receivables	927,457,263	930,178,763
Tangibles	92,314,101,238	91,173,861,661
Intangibles	1,591,326,020	1,694,469,940
Other Non-Current Assets	53,881,502	48,630,002
Marketable to be Non-Current Assets	55,634,462	55,634,462
Total Liabilities	205,777,177,225	181,411,478,571
Current Liabilities	176,881,804,389	147,177,571,046
Borrowings	137,494,167,762	116,086,512,081
Trade Payables & Other Payables	36,921,637,858	30,238,932,258
Provisions	20,283,276	31,774,967
Others	2,445,715,493	820,351,740
Non-Current Liabilities	28,895,372,836	34,233,907,525
Borrowings	11,367,057,642	7,051,658,085
Debentures	9,987,611,486	19,971,474,678
Confirmed Salary	6,517,240,247	6,359,380,847
Deferred Income Tax Credit	1,023,463,461	851,393,915
Capital Stock	10,806,615,000	10,806,615,000
Capital Surplus	29,906,601,157	29,906,601,157
Profit Surplus	65,015,220,990	64,752,654,759
Accumulated Income	16,050,030,192	16,050,030,192
Capital Adjustment	-946,981,246	-946,981,246
Total Equity	120,831,486,093	120,568,919,862
Liab. & Shareholder’s Equity	326,608,663,318	301,980,398,433

Income Statement
Unit : Korean Won	01/01/2011~03/31/2011	As of 12/31/2010	As of 12/31/2009
Sales	51,308,674,932
Cost of Sold Goods	40,217,568,092
Gross Profit	11,091,106,840
Selling Expenses	3,063,974,656
Admin. Expenses	3,110,013,747
Other Operating Income	1,857,988,456
Other Operating Expenses	2,998,749,004
Operating Income	3,776,357,889
Finance Income	1,868,627,049
Finance Expenses	3,031,310,818
Income Before Taxes	2,613,674,120
Income Before Taxes	189,784,889
Net Income	2,423,889,231

Cash Flows
Unit : Korean Won	01/01/2011~03/31/2011	As of 12/31/2010	As of 12/31/2009
Operating Activities Cash Flows	-561,882,133
Cash Flows from Investing	-7,758,250,955
Cash Inflow from Investing	797,230,000
Cash Outflows for Investing	-8,555,480,955
Cash Flows from Financing	11,432,140,093
Cash Inflows from Financing	16,632,207,438
Cash Outflows from Financing	-5,200,067,345
Increase/Decrease in Cash	3,107,037,005
Cash at the Beginning of Year	2,690,852,419
Cash at the End of Year	5,797,889,424

Products, Technologies, Services Description

Main Products & Services

End Mills, Taps, Drills

Trade Partners & Competitors

Competitors

INBEX DIAMOND CO., LTD. 296-2, DONGPAE 1-RI, GYOHA-EUP, PAJU-SI, GYEONGGI-DO, KOREA TEL:+82-31-945-2153 FAX:+82-31-945-2809 ACCUTECH CO., LTD. 1402-3, JUAN 5-DONG, NAM-GU, INCHEON, KOREA TEL:+82-32-816-8808 FAX:+82-32-811-0837 SEWON TECH CO., LTD. 396-11, CHEONGCHEON 2-DONG, BUPYEONG-GU, INCHEON, KOREA TEL:+82-32-582-4324~6 FAX:+82-32-582-4327

Related Parties

(Subsidiaries, Joint-Venture & Affiliates)

Affiliates

QINGDAO NEW CENTURY TOOL CO. ,LTD.(CHINA) (90.6% held by the subject company) QINGDAO YG-1 TOOL CO., LTD.(CHINA) (100.0% held by the subject company) YG-1 EUROPE SAS(FRANCE) (100.0% held by the subject company) PREMIER CUTTING TOOLS. INC.(USA) (100.0% held by the subject company) REGAL CUTTING TOOLS. INC.(USA) (60.0% held by the subject company) YG-1 INDUSTRIES INDIA PVT. LTD.(INDIA) (100.0% held by the subject company) EUROPA TOOLS CO., LTD.(UK) (81.1% held by the subject company) YG-1 DEUTSCHLAND GMBH(GERMANY) (100.0% held by the subject company) YG-1 AUSTRALIA PTY. LTD.(AUSTRALIA) (100.0% held by the subject company) YG-1 TOOLS ASIA PTE. LTD.(SINGAPORE) (100.0% held by the subject company) YG-1 JAPAN(JAPAN) (90.0% held by the subject company) ALPHA TOOL CO.,LTD.(JAPAN) (48.0% held by the subject company) YG-1 LATIN AMERICA(BRAZIL) TEKNO TAKIM SAN. TIC. AS.(TURKEY) YG CUTTING TOOLS CORPORATION PVT.LTD.(INDIA) CLARKSON OSBORN INTERNATIONAL LTD.(UK) MINICUT INTERNATIONAL. INC.(CANADA) NATIONAL TOOL HARDENING INC.(CANADA) YG-1 POLAND SP.ZOO(POLAND) YG-1 CANADA INC. YG-1 (HONG KONG) LIMITED YG-1 CORPORATION TRADING SRL (RUMANIA) YG-1 CHINA HOLDINGS LIMITED. YG-1 (THAILAND) CO, LTD.

Cooperative Enterprise

-Insured company SAMSUNG FIRE & MARINE INSURANCE CO., LTD.(110111-0005078)

Sales by Region

(Activity & Markets)

Sales/ Unit :Mil KRW	03/2011	2010	2009
Export	38,994	114,564	82,500
Domestic	12,314	48,612	33,007
Total	51,308	163,176	115,507

The Subject exports to Australia, Germany, Japan, Singapore, UK and USA. It imports from Europe.

Court Action

Case No.	Court	Plaintiff(s)/ Creditor(s)/ Applicant(s)	Defendant(s)/ Debtor(s)/ Respondent(s)	Cause	Amount (Million KRW)	Status
		-	The Subject Company	-	US$1,201,000	Proceeding

News Clipping

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FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.45.07
UK Pound	1	Rs.63.57
Euro	1	Rs.72.97

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