MIRA INFORM REPORT

Report Date :

03.08.2012

IDENTIFICATION DETAILS

Name :	NATO DYE & CHEMICAL (SHANGHAI) Co., Ltd.
Registered Office :	No. 185, Gangfeng Road, Waigang Town, Jiading District, Shanghai, 201806 Pr
Country :	China
Financials (as on) :	31.12.2011
Date of Incorporation :	03.11.1999
Com. Reg. No.:	310000400225822
Legal Form :	Wholly Foreign-Owned Enterprise
Line of Business :	Engaged In Manufacturing and Selling of Leather Dyes.
No. of Employees :	43

RATING & COMMENTS

MIRA’s Rating :

Ba

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

Status :	Satisfactory
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	A2	A2

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

COMPANY NAME AND ADDRESS

NATO DYE & CHEMICAL (SHANGHAI) Co., Ltd.

NO. 185, GANGFENG ROAD, WAIGANG TOWN, JIADING DISTRICT,

SHANGHAI, 201806 PR CHINA

TEL: 86 (0) 21-59589707 FAX: 86 (0) 21-59588719

EXECUTIVE SUMMARY

INCORPORATION DATE : NOV. 3, 1999

REGISTRATION NO. : 310000400225822

REGISTERED LEGAL FORM : WHOLLY FOREIGN-OWNED enterprise

CHIEF EXECUTIVE : MR. CHOI KHO (CHAIRMAN)

STAFF STRENGTH : 43

REGISTERED CAPITAL : USD 510,000

BUSINESS LINE : MANUFACTURING AND trading

TURNOVER : CNY 64,710,000 (AS OF DEC. 31, 2011)

EQUITIES : CNY 22,520,000 (AS OF DEC. 31, 2011)

PAYMENT : AVERAGE

MARKET CONDITION : AVERAGE

FINANCIAL CONDITION : FAIRLY STABLE

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.37 =USD 1

Adopted abbreviations:

ANS - amount not stated NS - not stated SC - subject company (the company inquired by you)

NA - not available CNY - China Yuan Renminbi

SC was registered as a wholly foreign-owned enterprise at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on Nov. 3, 1999.

Company Status: Wholly foreign-owned enterprise

This form of business in PR China is defined as a legal person. It is a limited co. established within the territories of PR China with capital provided totally by the foreign investors. More than one foreign investor may jointly invest in a wholly foreign-owned enterprise. The investing party/parties solely exercise management, reap profit and bear risks and liabilities by themselves. This form of companies usually have a limited duration is extendible upon approval of Examination and Approval Authorities.

SC’s registered business scope includes manufacturing leather fatliquoring agent, finishing agent, dyes, and additives; selling self-made products (with permit if needed)

SC is mainly engaged in manufacturing and selling leather dyes.

Mr. Choi Kho is the legal representative and chairman of SC at present.

SC is known to have approx. 43 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office and factory in Shanghai. The detailed information of the area is unspecified.

SC is not known to host website of its own at present.

Email: chinafactory@natodye.com

No significant events or changes were found during our checks with local AIC.

MAIN SHAREHOLDERS:

Name % of Shareholding

NATO Corporation Ltd. (Korea) 100

Website: http://www.natodye.com/

Email: natodye@natodye.com

Address: 73, Yongam-Ri, Eunhyun-Myun, Yangju-Kun, Kyungki-Do, South Korea

Tel: 82-31-862-8181

Fax: 82-31-864-4294

Legal Representative and Chairman:

Mr. Choi Kho (in Chinese Pinyin: Cui Hao), Korean, he is currently responsible for the overall management of SC.

Working Experience(s):

At present Working in SC as legal representative and chairman

Also working in NATO Corporation Ltd. (Korea) as chairman.

Note: The name of SC’s chairman should be “Choi Kho” or “Cui Hao”, instead of the given one “Cui Kho”

SC is mainly engaged in manufacturing and selling leather dyes.

SC’s products mainly include car cushion leather, furniture, shoes, bags, leather jackets and other leather dyes.

SC sources its materials 100% from domestic market. SC sells 95% of its products in domestic market, and 5% to overseas market.

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

Note: SC declined to release its major suppliers and clients.

According to http://www.natodye.com/

Shanghai Office

Tel: 86-21-6278-0942~4

Fax: 86-21-6208-0199

E-Mail: Shanghai@Natodye.Com

Guangzhou Office

Tel: 86-20-8388-7618(28)

Fax: 86-20-8388-7638

E-Mail: Guangzhou@Natodye.Com

Overall payment appraisal :

( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet 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.

Bank of China Shanghai Branch

AC#：N/A

Relationship: Normal.

Balance Sheet

Unit: CNY’000

	as of Dec. 31, 2010	as of Dec. 31, 2011
Cash & bank	4,050	2,250
Inventory	3,770	5,730
Accounts receivable	21,510	24,880
Other receivables	940	650
Advances to supplies	290	380
Other current assets	1,350	2,460
	------------------	------------------
Current assets	31,910	36,350
Fixed assets net value	2,630	2,220
Projects under construction	0	0
Long-term investments	0	0
Other assets	0	0
	------------------	------------------
Total assets	34,540	38,570
	=============	=============
Short loans	0	0
Accounts payable	12,020	13,840
Advances from clients	0	0
Other Accounts payable	880	860
Taxes payable	1,670	1,350
Other current liabilities	0	0
	------------------	-----------------
Current liabilities	14,570	16,050
Long term liabilities	0	0
	------------------	------------------
Total liabilities	14,570	16,050
Shareholders equities	19,970	22,520
	------------------	------------------
Total liabilities & equities	34,540	38,570
	=============	=============

Income Statement

Unit: CNY’000

	as of Dec. 31, 2011
Turnover	64,710
Cost of goods sold	48,730
Sales expense	7,260
Management expense	5,260
Finance expense	-30
Total profits before tax	3,470
Less: profit tax	920
Net profit	2,550

Important Ratios

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

	as of Dec. 31, 2010	as of Dec. 31, 2011
*Current ratio	2.19	2.26
*Quick ratio	1.93	1.91
*Liabilities to assets	0.42	0.42
*Net profit margin (%)	/	3.94
*Return on total assets (%)	/	6.61
*Inventory /Turnover ×365	/	33 days
*Accounts receivable/Turnover ×365	/	141 days
*Turnover/Total assets	/	1.68
* Cost of goods sold/Turnover	/	0.75

PROFITABILITY: AVERAGE

The turnover of SC appears average in its line in 2011.

SC’s net profit margin is average in 2011.

SC’s return on total assets is fairly good in 2011.

SC’s cost of goods sold is average, comparing with its turnover in 2011.

LIQUIDITY: FAIRLY GOOD

The current ratio of SC is maintained in a fairly good level.

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

The inventory of SC appears average.

The accounts receivable of SC appears large.

There is no short-term loan of SC in both years.

SC’s turnover is in an average level, comparing with the size of its total assets in 2011.

LEVERAGE: AVERAGE

The debt ratio of SC is low.

The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly Stable

SC is considered small-sized in its line with fairly stable financial conditions. The large amount of accounts receivable could be a threat to SC’s financial condition. The given credit amount would appear to be beyond SC’s capacities

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.78
UK Pound	1	Rs.86.75
Euro	1	Rs.68.32

INFORMATION DETAILS

Report Prepared by :

SDA

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.