MIRA INFORM REPORT

Report Date :

17.10.2011

IDENTIFICATION DETAILS

Name :	SNF (CHINA) FLOCCULANT CO., LTD.

Registered Office :	No. 6 Binjiang North Road, West Of Tongjiang Road, Taixing Economic Development Area, Jiangsu Province 225442 Pr China

Country :	China

Financials (as on) :	31.12.2010

Date of Incorporation :	26.06.1998

Com. Reg. No.:	321200400001162

Legal Form :	Wholly Foreign-Owned Enterprise

Line of Business :	Manufacturing and Selling Hazardous Chemicals

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 :	USD 8,000,000

Status :	Good

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^th, 2011

Country Name

Previous Rating

(30.06.2011)

Current Rating

(30.09.2011)

China

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

Company name & address

SNF (CHINA) FLOCCULANT CO., LTD.

no. 6 binjiang north road, west of tongjiang road,

taixing economic development area

jiangsu PROVINCE 225442 PR CHINA

TEL: 86 (0) 523-87676300

FAX: 86 (0) 523-87676423/87676451

EXECUTIVE SUMMARY

Date of Registration : june 26, 1998

REGISTRATION NO. : 321200400001162

LEGAL FORM : Wholly foreign-owned enterprise

CHIEF EXECUTIVE : RENE PICH (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : usd 76,000,000

staff : 466

BUSINESS CATEGORY : manufacturing

Revenue : CNY 1,606,980,000 (AS OF DEC. 31, 2010)

EQUITIES : CNY 689,570,000 (AS OF DEC. 31, 2010)

WEBSITE : www.snfchina.com

E-MAIL : N/A

PAYMENT : AVERAGE

Recommended Credit Limit: UP TO USD 8,000,000

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : stable

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : fairly good

EXCHANGE RATE : CNY 6.37 = USD 1

Adopted abbreviations

(As Follows)

SC - Subject Company (the company inquired by you)

N/A – Not available

CNY – China Yuan Ren Min Bi

OPERATIONAL TREND & GENERAL REPUTATION

This section aims at indicating the relative positions of SC in respect of its operational trend & general reputation

Operational Trend:- General Reputation:-

Upward Excellent

Steady Good

Fairly Steady Fairly Good

Ordinary Average

Fair Fair

Stagnant Detrimental

Downward Not known

Not known Not yet be determined

Not yet be determined

LEGAL STATUS & HISTORY

SC was established as a wholly foreign-owned enterprise of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 321200400001162 on June 26, 1998.

SC’s Organization Code Certificate No.: 70399602-7

SC’s registered capital: usd 76,000,000

SC’s paid-in capital: usd 76,000,000

Registration Change Record:

Date	Change of Contents	Before the change	After the change
2011	Registered Capital	USD 60,000,000	usd 76,000,000
2011	Legal Representative	Gerard Mouchiroud	Rene Pich

Current Co search indicates SC’s shareholders & chief executives are as follows:-

Name of Shareholder (s)	% of Shareholding
S.P.C.M.SA (France)	100

SC’s Chief Executives:-

Position	Name
Legal Representative and Chairman	Rene Pich
General Manager	Michel Bruno
Director	Rene Hund
	Gerard Mouchiroud
	Philippe Jeronimo
	Richard Saint Sauveur

RECENT DEVELOPMENT

No recent development was found during our checks at present.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

S.P.C.M.SA (France) 100

MANAGEMENT

Rene Pich, Legal Representative and Chairman

-------------------------------------------------------------

Ø Gender: M

Ø Certificate No.: JIHUG256325

Ø Qualification: University

Ø Working experience (s):

At present, working in SC as legal representative and chairman

Michel Bruno, General Manager

------------------------------------------

Ø Gender: M

Ø Certificate No.: 01AD13655

Ø Qualification: University

Ø Working experience (s):

At present, working in SC as general manager

Director

-----------

Rene Hund Certificate No.: JSTZS168888

Gerard Mouchiroud Certificate No.: JSRTY124563

Philippe Jeronimo Certificate No.: RHUIF256980

Richard Saint Sauveur Certificate No.: HJILH856931

BUSINESS OPERATION

SC’s registered business scope includes manufacturing hazardous chemicals (acrylamide); wholesale of hazardous chemicals (thiourea, maleic anhydride); manufacturing chemical products (polyacrylamide, ethyl acrylate dimethyl amine, quaternary ammonium salt); processing dissolution equipment; selling its owned products and providing after-sales service (including product design, installation, consulting, technical training services); wholesale of water treatment chemicals (excluding dangerous chemicals), sodium phosphate, ammonium chloride, ammonium adipate; international trade.

SC is mainly engaged in manufacturing and selling hazardous chemicals.

Brand: SNF FLOERGER

SC’s products mainly include:

Monomer

Polyacrylamide

Polydadmac

Polyamine

Polyquaternium

Dicyandiamide Resins

Superabsorbant

SC sources its materials 100% from domestic market. SC sells 35% of its products in domestic market, and 65% to overseas market, mainly USA, Europe, Southeast Asia, etc.

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

*Major Supplier:

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

LeiQi Energy-Saving Technology Co., Ltd.

Staff & Office:

--------------------------

SC is known to have approx. 466 staff at present.

SC owns an area as its operating office and factory, but the detailed information is unknown.

RELATED COMPANY

SC is known to have 3 branches at present:

· SNF (China) Flocculant Co., Ltd. Guangzhou Branch

· SNF (China) Flocculant Co., Ltd. Beijing Branch

· SNF (China) Flocculant Co., Ltd. Shanghai Branch

PAYMENT

Overall payment appraisal:

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

Trade payment experience: SC did not provide any name of trade/service suppliers and we have no other sources to conduct the enquiry at present.

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.

BANKING

The bank information of SC is not filed in SAIC.

FINANCIALS

Balance Sheet

Unit: CNY’000	As of Dec. 31, 2010
Cash	175,530
Accounts receivable	345,480
Other receivable	5,590
Inventory	343,330
Non-current assets within one year	0
Other current assets	116,240
	------------------
Current assets	986,170
Fixed assets	360,490
Construction in progress	75,190
Long-term prepaid expenses	0
Deferred income tax assets	0
Other non-current assets	28,260
	------------------
Total assets	1,450,110
	=============
Short-term loans	229,530
Notes payable	0
Accounts payable	350,360
Wages payable	0
Other payable	20,930
Other current liabilities	29,710
	------------------
Current liabilities	630,530
Non-current liabilities	130,010
	------------------
Total liabilities	760,540
Equities	689,570
	------------------
Total liabilities & equities	1,450,110
	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2010
Revenue	1,606,980
Cost of sales	1,436,680
Sales expense	114,360
Management expense	22,860
Finance expense	6,550
Profit before tax	30,850
Less: profit tax	6,790
Profits	24,060

Important Ratios

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

	As of Dec. 31, 2010
*Current ratio	1.56
*Quick ratio	1.02
*Liabilities to assets	0.52
*Net profit margin (%)	1.50
*Return on total assets (%)	1.66
*Inventory / Revenue ×365	78 days
*Accounts receivable/ Revenue ×365	79 days
* Revenue/Total assets	1.11
* Cost of sales / Revenue	0.89

FINANCIAL COMMENTS

PROFITABILITY: AVERAGE

l The revenue of SC appears fairly good in its line.

l SC’s net profit margin is average.

l SC’s return on total assets is average.

l SC’s cost of goods sold is average, comparing with its revenue.

LIQUIDITY: AVERAGE

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

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

l The inventory of SC is maintained in an average level.

l The accounts receivable of SC is maintained in an average level.

l SC’s short-term loan is in an average level.

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

LEVERAGE: FAIRLY GOOD

l The debt ratio of SC is low.

l The risk for SC to go bankrupt is low.

Overall financial condition of the SC: Stable.

CONCLUSIONS

SC is considered medium-sized in its line with stable financial conditions. A credit line up to USD 8,000,000 would appear to be within SC’s capacities.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.49.07
UK Pound	1	Rs.77.42
Euro	1	Rs.67.72

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.