MIRA INFORM REPORT

Report Date :

21.02.2012

IDENTIFICATION DETAILS

Name :	guangdong yueneng trading development co., ltd.

Registered Office :	23b, W. Dongxing Bldg., No. 488 E. Huanshi Road, Yuexiu District, Guangzhou, Guangdong Province 510075 PR

Country :	China

Financials (as on) :	31.12.2011

Date of Incorporation :	27.10.1995

Com. Reg. No.:	440000000024032

Legal Form :	Limited Liabilities Company

Line of Business :	Importing and Exporting Goods and Technology

No. of Employees :	17

RATING & COMMENTS

MIRA’s Rating :

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

Maximum Credit Limit :	USD 50,000
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 – 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

guangdong yueneng trading development co., ltd.

23b, w. dongxing BLDG., no. 488 E. huanshi road

yuexiu district, guangzhou, guangdong province 510075 PR CHINA

TEL: 86 (0) 20-87619888/87619688

FAX: 86 (0) 20-87620902

EXECUTIVE SUMMARY

Date of Registration : october 27, 1995

REGISTRATION NO. : 440000000024032

LEGAL FORM : Limited liabilities company

CHIEF EXECUTIVE : zhang guohui (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : cny 5,000,000

staff : 17

BUSINESS CATEGORY : trading

Revenue : CNY 57,530,000 (AS OF DEC. 31, 2011)

EQUITIES : CNY 8,210,000 (AS OF DEC. 31, 2011)

WEBSITE : N/A

E-MAIL : N/A

PAYMENT : AVERAGE

Recommended Credit Limi : UP TO USD 50,000 (PERIODICAL REVIEW)

MARKET CONDITION : average

FINANCIAL CONDITION : FAIRly stable

OPERATIONAL TREND : fairly STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.30 = USD

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.: 440000000024032 on October 27, 1995.

SC’s Organization Code Certificate No.: 23112204-8

SC’s registered capital: cny 5,000,000

SC’s paid-in capital: cny 5,000,000

Registration Change Record:

No significant changes of SC have been noted in SAIC since its incorporation.

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

Name of Shareholder (s)

% of Shareholding

Guangdong Yueneng (Holdings) Co., Ltd.

Labor Union of Guangdong Yueneng (Holdings) Co., Ltd.

SC’s Chief Executives:-

Position	Name
Legal Representative, Chairman, and General Manager	Zhang Guohui 张国辉

RECENT DEVELOPMENT

No recent development was found during our checks at present.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

Guangdong Yueneng (Holdings) Co., Ltd.

Labor Union of Guangdong Yueneng (Holdings) Co., Ltd.

Guangdong Yueneng (Holdings) Co., Ltd.

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

Date of Registration: December 16, 1992

Registration No.: 440000000003295

Legal Form: Limited Liabilities Company

Chief Executive: Zhang Baoxian

Registered Capital: CNY 120,000,000

Web: www.yueneng.com.cn

Tel: 86 020-38306133

Fax: 86 020-38306139

MANAGEMENT

Zhang Guohui, Legal Representative, Chairman and General Manager

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

Ø Gender: M

Ø Qualification: University

Ø Working experience (s):

At present, working in SC as legal representative, chairman and general manager, also working in Guangdong Sunniest Development Co., Ltd. as legal representative and chairman

BUSINESS OPERATION

SC’s registered business scope includes importing and exporting goods and technology; selling hardware, chemicals, needles, textiles, building materials, industrial production materials, department stores, household supplies, feed raw materials; related Information consulting.

SC is mainly engaged in international trade.

SC’s products mainly include:

Coal

Rolled Steel

Steel Pipe

Etc.

SC sources its materials 100% from domestic market, mainly Guangdong. SC sells 20% of its products in domestic market, and 80% 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.

*Major Suppliers:

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

Magang (Guangzhou) Steel Processing Co., Ltd.

Guangzhou Yufeng Holdings Co., Ltd.

Staff & Office:

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

SC is known to have approx. 17 staff at present.

SC rents an area as its operating office of approx. 200 sq. meters at the heading address.

RELATED COMPANY

n Guangdong Sunniest Development Co., Ltd.

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

Date of Registration: October 22, 1996

Registration No.: 440000000000241

Legal Form: Limited Liabilities Company

Chief Executive: Zhang Guohui

Registered Capital: CNY 1,880,000

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’s suppliers declined to make any comments.

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, 2011
Cash	47,710
Accounts receivable	1,820
Advances to suppliers	78,110
Other receivable	380
Inventory	16,450
Non-current assets within one year	0
Other current assets	520
	------------------
Current assets	144,990
Fixed assets	210
Construction in progress	0
Long-term prepaid expenses	0
Deferred income tax assets	0
Other non-current assets	10
	------------------
Total assets	145,210
	=============
Short-term loans	8,570
Notes payable	109,980
Accounts payable	0
Wages payable	0
Advances from clients	7,360
Other payable	11,150
Other current liabilities	-60
	------------------
Current liabilities	137,000
Non-current liabilities	0
	------------------
Total liabilities	137,000
Equities	8,210
	------------------
Total liabilities & equities	145,210
	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2011
Revenue	57,530
Cost of sales	56,300
Sales expense	200
Management expense	440
Finance expense	-10
Profit before tax	460
Less: profit tax	280
Profits	180

Important Ratios

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

	As of Dec. 31, 2011
*Current ratio	1.06
*Quick ratio	0.94
*Liabilities to assets	0.94
*Net profit margin (%)	0.32
*Return on total assets (%)	0.12
*Inventory / Revenue ×365	105 days
*Accounts receivable/ Revenue ×365	12 days
* Revenue/Total assets	0.40
* Cost of sales / Revenue	0.98

FINANCIAL COMMENTS

PROFITABILITY: AVERAGE

l The revenue of SC appears average 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 sales is high, 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 normal level.

l The inventory of SC appears large.

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

l SC’s short-term loans are in an average level.

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

LEVERAGE: AVERAGE

l The debt ratio of SC is high.

l The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly Stable.

CONCLUSIONS

SC is considered small-sized in its line with fairly stable financial conditions. The large amount of inventory may be a threat to SC’s financial condition. A credit line up to USD 50,000 is recommended upon a periodical review basis.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.49.21
UK Pound	1	Rs.77.75
Euro	1	Rs.64.58

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.

MIRA INFORM REPORT

Company name and address

EXECUTIVE SUMMARY

Adopted abbreviations (as follows)

OPERATIONAL TREND & GENERAL REPUTATION

LEGAL STATUS & HISTORY

RECENT DEVELOPMENT

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

MANAGEMENT

BUSINESS OPERATION

RELATED COMPANY

PAYMENT

BANKING

FINANCIALS

FINANCIAL COMMENTS

CONCLUSIONS

Unit