MIRA INFORM REPORT

Report Date :

28.04.2012

IDENTIFICATION DETAILS

Correct Name :	SHENZHEN DISCOVERY TECHNOLOGY CO., LTD.
Registered Office :	1 Fl, Building 29, Anle Industrial Zone Comprehensive Building, Guankou Second Rd, Nanshan Dist, Shenzhen City, Guangdong Province.
Country :	China
Financials (as on) :	31.12.2011
Date of Incorporation :	16.07.2007
Com. Reg. No.:	440301104384274
Legal Form :	Limited Liabilities Company
Line of Business :	Sales of computers and related auxiliary equipments.
No. of Employees :	50

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 :	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, 2012

Country Name	Previous Rating (31.12.2011)	Current Rating (31.03.2012)
China	A2	A2

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

Company name & address

SHENZHEN DISCOVERY TECHNOLOGY CO., LTD.
1 Fl, Building 29, Anle Industrial Zone Comprehensive Building, Guankou Second Rd, Nanshan Dist, Shenzhen City, Guangdong Province.
518052
Tel :	86 755 26977651
Fax:	86 755 26977650
Website:	http://www.vdiscovery.cn/
GTM Reference No.	120426112

Currency in this report is Chinese Yuan unless otherwise stated.

Exchange Rate: 1 USD=6.29 Chinese Yuan

"--"in this report indicates "unavailable" due to insufficient information or "no comments"

Notes:

The English name (Discovery Technology (Hongkong) Limited) provided in the order belongs to the Hong Kong offshore company registered by subject.

As to the address provided in the order, SC’s staff knew nothing about it.

EXECUTIVE SUMMARY

DATE OF establishment	July 16^th, 2007
Aic Registration No.	440301104384274
REGISTERED LEGAL FORM	LIMITED LIABILITIES COMPANY
REGISTERED CAPITAL	1,000,000.00
main BUSINESS	Sales of computers and related auxiliary equipments.
SIC Code (China)	6375 wholesale of computers, software and auxiliary equipment.
employees	50
import and export permits	yes
business scale	Medium
operation trend	Average
TURNOVER	23,014,000.00 (As of Dec.31^st, 2011)
net profit	28,000.00 (As of Dec.31^st, 2011)
total assets	4,493,000.00 (As of Dec.31^st, 2011)
net worth	1,048,000.00 (As of Dec.31^st, 2011)
EXCHANGE RATE	1 Usd=6.29CNY (APR 26^th, 2012)

REGISTRATION

Name	SHENZHEN DISCOVERY TECHNOLOGY CO., LTD.
AIC Registration Number	440301104384274
Previous Registration Number	4403011270669
Registered address	1 Fl, Building 29, Anle Industrial Zone Comprehensive Building, Guankou Second Rd, Nanshan Dist, Shenzhen City, Guangdong Province.
Operation address	1 Fl, Building 29, Anle Industrial Zone Comprehensive Building, Guankou Second Rd, Nanshan Dist, Shenzhen City, Guangdong Province.
Date of Establishment	July 16^th, 2007
Registry	Administration Bureau of Industry and Commerce – Shenzhen City
Legal Representative	Wang Xinchun
Registered Legal Form	LIMITED LIABILITIES COMPANY
Registered Capital	1,000,000.00
Operating Duration	July 16^th, 2007 to July 16^th, 2017
Business Scope	Technology development and sales of electronic products; Dealing with domestic trade; Import and export of goods and technologies (excluding those forbidden by law and with license for those needed); Technology development and sales of software.
Changes in Registration	1. Nov 27^th, 2009 SC’s registered address was changed to the present address from RM 1105 & 1106, Dongxita Building, Nanshan Software Park, Shennan Avenue, Nanshan Dist, Shenzhen City, Guangdong Province. 2. Nov 27^th, 2009 SC’s Registration No. was changed from 4403011270669 to 440301104384274. 3. Oct 18^th, 2010 SC’s shareholders were changed to Wang Xinchun and Huang Yongkang from Wang Xinchun, Huang Yongkang and SHANDONG LICHUANG SCIENCE AND TECHNOLOGY CO. LTD. 4. Nov 22^nd, 2010 SC’s shareholders were changed to the present shareholders.

Limited liabilities co.

This form of business in PR China is defined as a legal person. Its registered capital is contributed jointly by at least two shareholders and no more than fifty. Shareholders bear limited liability to the extent of shareholding, and the co. is liable for its debts only to extent of its total assets. The characteristics of this form of co. are as follows:

Upon the establishment of the co., an investment certificate is issued to the each of shareholders.

The board of directors is comprised of three to thirteen members.

The minimum registered capital for a co. is listed as follows:

-manufacturing co. : RMB 500,000.00

-trading &wholesaling co. : RMB 500,000.00

-retailing co. : RMB 300,000.00

-consultancy & service co. : RMB 100,000.00

Shareholders may take their capital contributions in cash or by means of tangible assets or intangible assets such as industrial property and non-patented technology.

Cash contributed by all shareholders must account for at least 50% of the registered capital while contribution by intangible assets must not exceed 20% of the registered capital.

Existing shareholders have pre-exemption right to purchase shares of the co. offered for sale by the other shareholders and to subscribe for the newly increased registered capital of the co.

REGISTRATION INFO: AVAILABLE

FINANCIAL REPORTS: AVAILABLE

SHAREHOLDERS AND SHARES

As indicated in the following table:

Shareholder	Capital Subscribed	Percentage
Zeng Feng	110,000.00	11%
Wang Xinchun	890,000.00	89%
Total	1,000,000.00	100%

Shareholder	Paid-up Percentage
Zeng Feng	100%
Wang Xin-chun	100%

AFFILIATE(S)

Name	Discovery Technology (Hongkong) Limited
Country	HONG KONG
File No.	1113171
Relationship With SC	Offshore company.
Date of establishment	Mar 6^th, 2007
Company legal form	Private company.

MANAGEMENT

Name	Wang Xinchun
Title	Executive director and General manager
Name	Zeng Feng
Title	Supervisor

BANKERS INFORMATION

SC’s bank information can’t be obtained after searching through all available channels.

OFFICE FACILITIES

Geographic Location	1 Fl, Building 29, Anle Industrial Zone Comprehensive Building, Guankou Second Rd, Nanshan Dist, Shenzhen City, Guangdong Province.
Area	1,000 square meters
Environment and traffic	Acceptable
Property Ownership	Rented

TRADEMARKS

Total amount	1
Registration No.	8728918
Registration Date	Oct 11^th, 2010
Image

PATENTS

After checking with the State Intellectual Office, no patents of SC were found.

MAIN PRODUCTS & SERVICES

Main business	Sales of computers and related auxiliary equipments.
Products and services	SC mainly deals with sales of computers and related auxiliary equipments. Its products include tablet personal computers, software, USB Flash Disk chips, Mp4, Mp5, CMMB, touch-screen, LCD screen, Mobile TVs, MID function boards, etc.

SALES INFORMATION

Local sales	10%
Regions	Shenzhen City.
Major domestic clients	SHENZHEN SHOWTONE NETRONICS CO. LTD, etc.
Payment terms	Prompt payment; on credit
Export	90%
Regions	Southeast Asian countries including India, etc.
Major overseas clients	International electronic manufacture enterprises, etc.
Payment terms	L/C, T/T
SC’s products are mainly exported to South Asian countries, etc. Its clients are mainly electronic manufacture enterprises, etc. It has fixed clients.
The above information was confirmed by SC’s employee

PURCHASE INFORMATION

Main Commodities Purchased	USB Flash Disk chips, tablet personal computers, touch-screens, software, MID function boards, etc.
Region	Local: 100% Import: 0%
Number of Major Suppliers	More than 5
Major suppliers	SHENZHEN SILICON-GO CO. LTD; SHANGHAI INFOTM MICROELECTRONICS CO. LTD; FUZHOU ROCKCHIP ELECTRONICS CO. LTD, etc.
Main Terms of Payment	Local: Prompt payment; on credit
SC’s products are mainly provided by domestic electronic manufacture enterprises. The products SC deals with are of many brands provided by many enterprises.
The above information was confirmed by SC’s employee

CREDIT

Name of supplier	SHENZHEN SILICON-GO CO. LTD
Main commodities and service supplied	USB Flash Disk chips
Title of interviewee	Office staff
Telephone of Interviewee	86 755 88852296
Cooperation	Confirmed
Payment comment	Acceptable

LITIGATION RECORDS

After checking with China Court organization, the local court website and other major searching websites, no litigation record related to subject company in the latest three years is found.

FINANCE

Balance Sheet (Unit: 1,000 Chinese Yuan):

	Dec. 31^st, 2010	Dec. 31^st, 2011
Current assets
Money capital	414	1,255
Short-term investment
Notes receivable
Net ball of Account Receivable	2,771	122
Payment in advance
Subsidy Receivable
Other Account Receivable	38	62
Inventory	2,038	2,421
Expenses to be deferred
Other current assets
Export rebates receivable
Total current Assets	5,261	3,860
Long-term investment
Long-term investment		450
Original value of fixed assets
Accumulated depreciation
Net fixed assets	180	132
Fixed assets depreciation reserve
Net Value of Fixed Assets	180	132
Fixed assets in liquidation
Projects being constructed
Fixed assets losses in suspense
Total fixed assets	180	132
Intangible assets and deferred assets
Intangible assets
Deferred assets
Total intangible and deferred assets	-	-
Other long-term assets
Long-term deferred assets	15	51
Total assets	5,456	4,493
Current liabilities
Short-term loans
Notes payable
Account payable	3,012	1,675
Deposit received	518	596
Other accounts payable	870	1,110
Wages payable
Welfare payable
Tax unpaid	24	64
Unpaid profit
Accrued expenses
L/T debt due in 1 year
Other current liabilities
Total current liabilities	4,424	3,445
L/T liabilities
L/T loans
Bonds payable
L/T account payable	0	0
Total L/T liabilities	4,424	3,445
Deferred tax
Deferred tax
Total liabilities
Owner’s interest
Paid-up capital	1,000	1,000
Contributed surplus
Surplus reserves
Unconfirmed investment loss
Undistributed profits	32	48
Minority interest
Total owner’s interest	1,032	1,048
Liabilities and owner’s interest	5,456	4,493

Income Statement (Unit: 1,000 Chinese Yuan):

	Dec. 31^st, 2010	Dec. 31^st, 2011
Main business income		23,014
Main business cost		20,857
Tax and associate charge		41
Main business profit		2,116
Other business profit		127
Operation expenses		80
- management expenses		2,129
Financial expenses		-2
Operation profit		36
Investment profit
Subsidy income
Non business income
- non business expenses
Prior year income adjustment
Total profit
- income tax		36
Minority stock holder’s interest		8
Net profit		28

Note: Through the current AIC channels, SC’s Income Statement of 2010 can’t be obtained.

Important Ratios:

	2010	2011
Return on net assets (%)		2.67
Return on total assets (%)		0.62
Net profit margin (%)		0.12
Turnover of total assets		5.12
Turnover of current assets		5.96
Turnover of account receivable		188.64
Inventory turnover		8.62
Asset liability ratio (%)	81.09	76.67
Current ratio	1.19	1.12
Quick ratio	0.73	0.42

Major Financial Information (Unit: 1,000 Chinese Yuan):

	2010	2011
Main business income		23,014
Total profit		36
Net profit		28
Total assets	5,456	4,493
Total liabilities	4,424	3,445
Total owner’s interest	1,032	1,048
Source from	government	government
Whether audited or not	Yes	Yes

Analysis of financial indicator

Long-term solvency: poor

Short-term solvency: poor

Asset security: poor

Inventory status: average

Capital turnover: average

Debt recovery status: good

Profitability: poor

Return on assets (ROA): poor

Enterprise background: average

Payment records: acceptable

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.52.68
UK Pound	1	Rs.85.12
Euro	1	Rs.69.38

INFORMATION DETAILS

Report Prepared by :

MNL

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.