MIRA INFORM REPORT

Report Date :

16.02.2012

IDENTIFICATION DETAILS

Name :	WUHAN WUYAO PHARMACEUTICAL CO., LTD.

Registered Office :	No. 5 Gutian Road, Qiaokou District, Wuhan Hubei Province 430035 Pr

Country :	China

Financials (as on) :	31.12.2010

Date of Incorporation :	28.07.2002

Com. Reg. No.:	420104000004384

Legal Form :	Limited Liabilities Company

Line of Business :	Manufacturing and selling chemical raw materials.

No. of Employees :	100

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 200,000
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, 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 and address

WUHAN WUYAO PHARMACEUTICAL CO., LTD.

NO. 5 GUTIAN ROAD, QIAOKOU DISTRICT, WUHAN

HUBEI PROVINCE 430035 PR CHINA

TEL: 86 (0) 27-83827810/83834209

FAX: 86 (0) 27-83836358

EXECUTIVE SUMMARY

Date of Registration : july 28, 2002

REGISTRATION NO. : 420104000004384

LEGAL FORM : Limited liabilities company

CHIEF EXECUTIVE : zhang bangguo (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : cny 61,000,000

staff : 100

BUSINESS CATEGORY : manufacturing

Revenue : CNY 272,170,000 (AS OF DEC. 31, 2010)

EQUITIES : CNY 43,450,000 (AS OF DEC. 31, 2010)

WEBSITE : www.wyzy.net

E-MAIL : wyzy@wyzy.net

PAYMENT : AVERAGE

Recommended Credit Limit: UP TO USD 200,000

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : FAIRly stable

OPERATIONAL TREND : fairly STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.30 = 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 limited liabilities company of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 420104000004384 on July 28, 2002.

SC’s Organization Code Certificate No.: 74140314-9

SC’s registered capital: cny 61,000,000

SC’s paid-in capital: cny 61,000,000

Registration Change Record:

Date	Change of Contents	Before the change	After the change
2003-8-26	Registered Capital	CNY 16,800,000	CNY 31,000,000
2003-8-26	Shareholder (s) (% of Shareholding)	Wuhan Tiantianming Pharmaceutical Co., Ltd. 2.98% Wuhan Pharmaceutical Group Co., Ltd. 92.86% Xiangfan Alcohol Plant 1.78% China Chemical Supply and Marketing Central South Company 2.38%	Wuhan Tiantianming Pharmaceutical Co., Ltd. 2.98% Wuhan Yuanda Pharmaceutical Group Co., Ltd. 93.94% Xiangfan Alcohol Plant 1.79% China Chemical Produce Stock Co., Ltd. 1.29%
2004-8-2	Legal Representative	Zhang Yousheng	Wei Junhao
2004-9-28	Registration No.	4201151100130	4201041100352
2007-4-23	Legal Representative	Wei Junhao	Zhang Bangguo
2007-9-11	Shareholder (s) (% of Shareholding)	Wuhan Tiantianming Pharmaceutical Co., Ltd. 2.98% Wuhan Yuanda Pharmaceutical Group Co., Ltd. 93.94% Xiangfan Alcohol Plant 1.79% China Chemical Produce Stock Co., Ltd. 1.29%	Wuhan Tiantianming Pharmaceutical Co., Ltd. 1.61% Wuhan Yuanda Pharmaceutical Group Co., Ltd. 97.10% China Chemical Produce Stock Co., Ltd. 1.29%
2007-9-11	Registration No.	4201041100352	420104000004384
2011-1-20	Shareholder (s) (% of Shareholding)	Wuhan Tiantianming Pharmaceutical Co., Ltd. 1.61% Wuhan Yuanda Pharmaceutical Group Co., Ltd. 97.10% China Chemical Produce Stock Co., Ltd.1.29%	Wuhan Tiantianming Pharmaceutical Co., Ltd. 0.82% Wuhan Yuanda Pharmaceutical Group Co., Ltd. 98.52% China Chemical Produce Stock Co., Ltd. 0.66%
2011-1-20	Registered Capital	CNY 31,000,000	CNY 61,000,000
2011-11-1	Shareholder (s) (% of Shareholding)	Wuhan Tiantianming Pharmaceutical Co., Ltd.0.82% Wuhan Yuanda Pharmaceutical Group Co., Ltd. 98.52% China Chemical Produce Stock Co., Ltd. 0.66%	Wuhan Tiantianming Pharmaceutical Co., Ltd. 0.82% Grand Pharma (China) Co., Ltd. 98.52% China Chemical Produce Stock Co., Ltd. 0.66%

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

Name of Shareholder (s)	% of Shareholding
Grand Pharma (China) Co., Ltd.	98.52
Wuhan Tiantianming Pharmaceutical Co., Ltd.	0.82
China Chemical Produce Stock Co., Ltd.	0.66

SC’s Chief Executives:-

Position	Name
Legal Representative, Chairman, and General Manager	Zhang Bangguo

RECENT DEVELOPMENT

No recent development was found during our checks at present.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

Grand Pharma (China) Co., Ltd. 98.52

Wuhan Tiantianming Pharmaceutical Co., Ltd. 0.82

China Chemical Produce Stock Co., Ltd. 0.66

Grand Pharma (China) Co., Ltd.

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

Date of Registration: February 24, 1990

Registration No.: 420100400000587

Legal Form: Chinese-foreign equity joint venture enterprise

Chief Executive: Xie Guofan

Registered Capital: CNY 185,000,000

Wuhan Tiantianming Pharmaceutical Co., Ltd.

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

Date of Registration: June 6, 1996

Registration No.: 420104000007475

Legal Form: Limited Liabilities Company

Chief Executive: Chen Bin

Registered Capital: CNY 10,000,000

China Chemical Produce Stock Co., Ltd.

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

Date of Registration: January 4, 2001

Registration No.: 100000000034895

Legal Form: Shares Limited Company

Chief Executive: Zhou Dechun

Registered Capital: CNY 188,990,000

MANAGEMENT

Zhang Bangguo , Legal Representative, Chairman and General Manager

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

Ø Gender: M

Ø Qualification: University

Ø Working experience (s):

From 2007 to present, working in SC as legal representative, chairman and general manager

BUSINESS OPERATION

SC’s registered business scope includes manufacturing and selling chemical raw materials; exporting its products and technology; importing materials, instrument, machinery and equipment, parts and technology needed for its production; processing with imported materials, processing with imported samples, assembling with imported parts, and compensation trade in agreement; pharmaceutical engineering design, manufacture, installation, medical engineering technology development and consulting; manufacturing bulk drugs.

SC is mainly engaged in manufacturing and selling chemical raw materials.

SC’s products mainly include:

Analgin

Metronidazole

Enoxacin

SC sources its materials 100% from domestic market, mainly Hubei. SC sells 45% of its products in domestic market, and 55% to overseas market, mainly Southeast Asian market.

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.

Staff & Office:

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

SC is known to have approx. 100 staff at present.

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

RELATED COMPANY

SC is not known to have any subsidiary at present.

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, 2009	As of Dec. 31, 2010
Cash	440	9,041
Notes receivable	3,086	3,571
Accounts receivable	74	9,935
Advances to suppliers	3,656	3,387
Other receivable	8,509	190
Inventory	28,770	42,801
Prepaid expenses	16	13
Other current assets	178	1,058
	------------------	------------------
Current assets	44,729	69,996
Long-term investment	17,564	17,564
Fixed assets	28,711	31,551
Construction in progress	2,424	7,877
Intangible assets	0	0
Long-term prepaid expenses	495	545
Deferred income tax assets	1,804	2,360
Other non-current assets	0	0
	------------------	------------------
Total assets	95,727	129,893
	=============	=============
Short-term loans	0	0
Notes payable	0	5,000
Accounts payable	15,716	16,027
Wages payable	3,508	8,571
Taxes payable	211	2,093
Advances from clients	2,611	4,481
Other payable	700	4,648
Other current liabilities	38,583	45,623
	------------------	------------------
Current liabilities	61,329	86,443
Non-current liabilities	0	0
	------------------	------------------
Total liabilities	61,329	86,443
Equities	34,398	43,450
	------------------	------------------
Total liabilities & equities	95,727	129,893
	=============	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2009	As of Dec. 31, 2010
Revenue	190,274	272,170
Cost of sales	166,690	218,621
Taxes and surcharges	1,247	1,169
Sales expense	6,241	16,203
Management expense	14,452	23,841
Finance expense	945	2,107
Non-business income	276	486
Non-business expense	41	10
Profit before tax	683	10,043
Less: profit tax	116	991
Profits	567	9,052

Important Ratios

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

	As of Dec. 31, 2009	As of Dec. 31, 2010
*Current ratio	0.73	0.81
*Quick ratio	0.26	0.31
*Liabilities to assets	0.64	0.67
*Net profit margin (%)	0.30	3.33
*Return on total assets (%)	0.59	6.97
*Inventory / Revenue ×365	56 days	58 days
*Accounts receivable/ Revenue ×365	1 day	14 days
* Revenue/Total assets	1.99	2.10
* Cost of sales / Revenue	0.88	0.80

FINANCIAL COMMENTS

PROFITABILITY: FAIRLY GOOD

l The revenue of SC appears fairly good, and it was rising in 2010.

l SC’s net profit margin is average in both years.

l SC’s return on total assets is average in 2009 and fairly good in 2010.

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

LIQUIDITY: FAIR

l The current ratio of SC is maintained in a fair level in both years.

l SC’s quick ratio is maintained in a fair level in both years.

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 has no short-term loans in both years.

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

LEVERAGE: AVERAGE

l The debt ratio of SC is average.

l The risk for SC to go bankrupt is average

Overall financial condition of the SC: Fairly Stable.

CONCLUSIONS

SC is considered medium-sized in its line with fairly stable financial conditions. A credit line up to USD 200,000 would appear to be within SC’s capacities.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.49.29
UK Pound	1	Rs.77.45
Euro	1	Rs.64.89

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.