MIRA INFORM REPORT

Report Date :

01.06.2012

IDENTIFICATION DETAILS

Name :	SINOCHEM ENVIRONMENTAL PROTECTION CHEMICALS (TAICANG) CO LTD.
Registered Office :	No.18, Binjiang South Rd, Shihua Dist, Taicang Port Development Zone, Taicang City, Suzhou City, Jiangsu Province
Country :	China
Financials (as on) :	2010
Date of Incorporation :	14.10.2005
Com. Reg. No.:	320000400001705
Legal Form :	Sino-Foreign Joint Venture
Line of Business :	Manufacture and sales of refrigerant products, etc.
No. of Employees :	500

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 – 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

Sinochem Environmental Protection Chemicals (Taicang) Co Ltd.

Currency in this report is Chinese Yuan unless otherwise stated.

Exchange Rate: 1 USD=6.34 Chinese Yuan

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

ORDER INFORMATION

name	Sinochem Environmental Protection Chemicals (Taichang) Co Ltd.
address	No.18, Binjiang Road, Shihua Industrial Park, Taicang Port Jiangsu P.R. of China
tel.	86 512 53713179

EXECUTIVE SUMMARY

DATE OF establishment	Oct 14^th, 2005
Aic Registration No.	320000400001705
REGISTERED LEGAL FORM	Sino-foreign joint venture
REGISTERED CAPITAL	413,000,000.00
main BUSINESS	Manufacture and sales of refrigerant products.
tax no.	320585778044987
TURNOVER	960,700,000.00 (As of Dec.31^st, 2010)
net profit	265,000,000.00 (As of Dec.31^st, 2010)
total assets	685,400,000.00 (As of Dec.31^st, 2010)
net worth	580,500,000.00 (As of Dec.31^st, 2010)
employees	500
import and export permits	yes
EXCHANGE RATE	1 Usd=6.34CNY (MAY.31^st, 2012)

Registered Address	No.18, Binjiang South Rd, Shihua Dist, Taicang Port Development Zone, Taicang City, Suzhou City, Jiangsu Province.
Zip Code	215433
Business Address	No.18, Binjiang South Rd, Shihua Dist, Taicang Port Development Zone, Taicang City, Suzhou City, Jiangsu Province.
Zip Code	215433
Telephone	86 512 53713192/53713179
Fax	86 512 53713177
SIC Code (China)	2614 manufacture of organic chemical material

REGISTRATION

Name (Chinese)	太仓中化环保化工有限公司
Name (English)	Sinochem Environmental Protection Chemicals (Taicang) Co Ltd.
Date of Establishment	Oct 14^th, 2005
Registry	Administration Bureau of Industry & Commerce – Taicang City (Suzhou)
Legal Representative	Wang Shuiyao
AIC Registration Number	320000400001705
Registered Legal Form	SINO-FOREIGN JOINT VENTURE
Registered Capital	413,000,000.00 CNY
Operating Duration	Oct 14^th, 2005 to Oct 13^th, 2055
Business Scope	Research and manufacture of HFC-134a, etc; Sales of self-produced products; Import and export of goods and technologies.

Sino-foreign joint venture

This form of business in PR China is defined as a legal person. It is a limited co. jointly invested by one or more foreign companies and one or more PR China controlled companies within the territories of PR China according to a certain proportion of capital investment. The investing parties exercise business management, share profits and bear all risks and liabilities of the co. together. The equity joint venture law requires that foreign party contribute not less than 25% of the registered capital, with no maximum. The joint venture usually has a limited duration of 10 to 50 years. Enterprise with large investment, long construction periods, low investment returns, introducing of advanced technology & advanced technology products which have good competition position in international market may extend beyond the 50 years limit.

REGISTRATION INFO: AVAILABLE

FINANCIAL REPORTS: AVAILABLE

FIELD INVESTIGATION

1. SC’s business income comes mainly from refrigerant products including organic fluoride, fluor opolymer, fluorine fine chemicals, PTMEG, etc. SC’s products are sold both domestically and internationally. Its products are sold through distributors to end customers domestically and its international sales business is developed directly to end customers internationally. Its clients are mainly domestic and international manufacture enterprises of automobiles, refrigerators, etc. The refrigerant products industry is an industry with fierce competition. There are a lot of similar enterprises in the local place as SC’s competitors. However, with several years’ history, SC has accumulated certain amount of customers and enjoys certain popularity in both domestic and international market. Generally speaking, SC’s competitiveness is above average in the local industry.

2. Located in the southeast of Jiangsu Province and southern bank of Yangtze estuary, SC’s location Taicang City is the nearest city form Shanghai City. With brilliant cultural background and rapidly developing industry, Taicang City is one of the most developed cities of China and its economy growth rate ranks first in Suzhou City. With highly developed real estate industry, financial securities industry, commerce industry, transportation & logistics industry and tourism industry, the total GDP of Taicang City in 2011 was 86.632 billion CNY, increasing 15.8% year/year. The increased value of first industry was 5.466 billion CNY, increasing 4.5% year/year; the increased value of second industry was 35.535 billion CNY, increasing 12.9% year/year; the increased value of third industry was 33.200 billion CNY, increasing 22.3% year/year. As a sino-foreign joint venture dealing with manufacture and sales of organic fluoride, SC shares certain favorable policies provided by the local government.

SHAREHOLDERS AND SHARES

As indicated in the following table:

Shareholder	Capital Subscribed	Percentage
CHINA NEWTECH DEVELOPMENT AND TRADE CO.,LTD	4,1300,000.00	10%
SINOCHEM MODERN ENVIRONMENTAL PROTECTION CHEMICALS (XI'AN) CO., LTD	227,150,000.00	55%
SINOCHEM EUROPEAN CAPITAL CO. LTD	144,550,000.00	35%
Total	413,000,000.00	100%

Shareholder	Way of Investment	Paid-up Percentage
CHINA NEWTECH DEVELOPMENT AND TRADE CO.,LTD	Capital	100%
SINOCHEM MODERN ENVIRONMENTAL PROTECTION CHEMICALS (XI'AN) CO., LTD	Capital	100%
SINOCHEM EUROPEAN CAPITAL CO. LTD	Capital	100%

Background of major shareholder

Name	CHINA NEWTECH DEVELOPMENT AND TRADE CO.,LTD
Registered address	4 Fl, No.487, Tiyuchang Rd, Hangzhou City, Zhejiang Province.
Main business	International bidding business, international trade and sales of chemical products.
Name	SINOCHEM MODERN ENVIRONMENTAL PROTECTION CHEMICALS (XI'AN) CO., LTD
Registered address	Jinghe Industrial Zone, Xi’an Economy & Technology Development Zone, Xi’an City, Shaanxi Province.
Main business	Development and manufacture of HFC-134a refrigerant and related organic fluorine, etc.
Name	SINOCHEM EUROPEAN CAPITAL CO. LTD
Country	UK

AFFILIATE(S)

No affiliates of subject company is found after checking.

MANAGEMENT

Name	Wang Shuiyao
Gender	Male
Title	Chairman
Date of birth	Aug 6^th, 1960
Working experience	He has successively held the posts of Deputy Director and Director Assistant of People’s Government Economic and Technical Cooperation Office General Department, Vice General Manager of Zhejiang Economy Cooperation Company, General Manager of Zhejiang Province Real Estate Association, Party Committee Member, Director and Vice General Manager of ZHEJIANG PETROCHEMICAL&BUILDING MATERIALS GROUP CO. LTD, etc.
Name	Mao Jiangqiang
Gender	Male
Title	Director
Date of birth	Sep 20^th, 1966
Name	Wang Jun
Gender	Male
Title	Director
Date of birth	July 19^th, 1972
Name	Chen Shukang
Gender	Male
Title	Director
Date of birth	April 23^rd, 1966
Name	Lu Fangbin
Gender	Male
Title	Director
Date of birth	Sep 18^th, 1968
Name	Zhang Haibing
Gender	Male
Title	Director and General Manager
Date of birth	Sep 9^th, 1965
Name	Wu Kanghui
Gender	Male
Title	Director
Date of birth	Oct 7^th, 1963
Name	Zhang Zhihua
Gender	Male
Title	Supervisor
Date of birth	Oct 6^th, 1955

NUMBER OF EMPLOYEES

Employees: 500

Management Staff: 35

Recent recruitment: Yes

Job-hunting websites	Job title	Number
http://hx.job1001.com/Company_Detail.php?CompanyDetail=cm1314687032188	Electrical engineer.	1
http://hx.job1001.com/Company_Detail.php?CompanyDetail=cm1314687032188	Sponsor of New Product Development.	1
http://hx.job1001.com/Company_Detail.php?CompanyDetail=cm1314687032188	Engieer.	1

BANKERS INFORMATION

Bank name	--
Account No. (CNY)	--
Tel.	--
Comment	SC’s staff refused to disclose the bank information due to company secrecy and the bank information is unavailable through all available channels.

OFFICE FACILITIES

Geographic Location	No.18, Binjiang South Rd, Shihua Dist, Taicang Port Development Zone, Taicang City, Suzhou City, Jiangsu Province.
Area	65000 Square Meters
Environment	Industrial Zone.
Traffic condition	With only 40 kilometers from Hongqiao International Airport and surrounded by Yanjiang Express Way, Sujiahang Express Way and Shanghai Waihuan Express Way, SC’s traffic condition is convenient.
Purpose	Office/Warehousing/Factory.
Property Ownership	Self-owned.
Other address	--

WEBSITE

Website	http://www.sinochemtc.com/
e-mail	--
Operation status	Operational
Copyright	Copyright reserved by SC.
Language	Chinese.

TRADEMARKS/PATENTS

After checking with the Trademark Office of Chinese Administration Bureau of Industry and Commerce and the State Intellectual Office, no trademarks or patents of SC were found.

MAIN PRODUCTS & SERVICES

Main business	Manufacture and sales of refrigerant products, etc.
Products and services	SC mainly deals with research, manufacture and sales of ODS series substitute, fluoropolymer, fluorine fine chemicals and PTMEG. Its products include HFC-134a, HFC-125, hydrochloric acid, etc. SC’s products are mainly used to manufacture of spandex, polyurethane, etc. and are widely used by automobile enterprises, refrigerator enterprises, aerosol factory, etc.
Picture of specific products
Annual production capacity	30,000 tons of HFC-134a per year; 20,000 tons of PTMEG per year.
Plants and equipments	Heteropoly aicd catalyst device, HFC-134a manufacture device, etc.
Awards & Honors	“High-integrity enterprise with safety manufacture”; “Labor Relation Harmonious Enterprise”, etc.
Certificates / licenses	--

SALES INFORMATION

Domestic sales	30%
Regions	All over China
Major domestic clients	SINOCHEM MODERN ENVIRONMENTAL PROTECTION CHEMICALS (XI'AN) CO., LTD, etc.
Competitors	ZHEJIANG JUHUA CO. LTD; DAIKIN FLUOROCHEMICALS (CHINA) CO., LTD.; GUANGZHOU XINGSHENGJIE SCIENCE TECHNOLOGY CO. LTD, etc.
Payment terms	Prompt payment; on credit
Export	70%
Regions	Europe, America, Australia, Mid-east, Africa etc.
Major overseas clients	Autozone Inc., etc.
Payment terms	L/C, T/T
SC’s products are sold both domestically and internationally. Its domestic sales business is developed through its shareholder in Xi’an. SC’s international clients are mainly refrigerator enterprises, automobile enterprises, etc.
The above information was confirmed by SC’s employee on May 31^st, 2012.

PURCHASE INFORMATION

Main Commodities Purchased	Chemical raw materials, air compressors, office supplies, etc.
Number of Major Suppliers	About 5
Region	Domestic: 90% Import: 10%
Major suppliers	YANTAI MOON CO. LTD; SUZHOU PURUIFEI ENVIRONMENT PROTECTION TECHNOLOGY CO. LTD, etc.
Main Terms of Payment	Local: Prompt payment; on credit Import: L/C, T/T
SC’s raw materials and equipments are purchased both domestically and internationally. With several years’ history, it has fixed suppliers and stable sources of goods.
The above information was confirmed by SC’s employee on May 31^st, 2012.

CREDIT

Name of supplier	YANTAI MOON CO. LTD
Main commodities and service supplied	Air compressors, etc.
Interviewee	Miss Yu of Business Department.
Telephone of Interviewee	86 535 6693308
Payment comment	The investigated person confirmed SC is one of their clients, but was not clear about its payment status.
Date of interview	May 31^st, 2012.
Name of supplier	SUZHOU PURUIFEI ENVIRONMENT PROTECTION TECHNOLOGY CO. LTD
Main commodities and service supplied	Environment protection service, etc.
Interviewee	Staff of Business Department.
Telephone of Interviewee	86 512 68310299
Payment comment	The investigated person confirmed SC is one of their clients and SC usually makes payment in time.

LITIGATION RECORDS

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

OTHER ADVERSE MEDIA INFORMATION

N/A

MEDIA INFORMATION

1. SC’s litigation-responding information to India anti-dumping. (http://www.xjftec.gov.cn/Family/Yujingxinxi/4028c28427470f23012784f3503107c8.html)

2. SC’s bidding information of electric wire and electric cable. (http://greenisland.co.sonhoo.com/info/582517.html)

3. SC’s bidding information of stainless steel tanks. (http://qwe5993.blog.163.com/blog/static/20446004520122152371857/)

4. SC’s bidding information of chilling system. (http://blog.china.alibaba.com/blog/cnzbcg/article/b0-i25204766.html)

5. SC’s global marketing information.

(http://www.chinatpm.com/tpm/glcx_494_1203.html)

6. SC’s lawsuit winning information.

(http://msss.fabao365.com/info/22228)

FINANCE

Balance Sheet & Income Statement (Unit: 1,000 Chinese Yuan):

	Dec. 31^st, 2010
Total assets	685,400
Total liabilities	104,900
Total owner’s interest	580,500
Liabilities and owner’s interest	685,400
Main business income	960,700
Total profit	290,300
-Income tax	25,300
Net profit	265,000

Note: Through the current AIC channels, only SC’s financial summary of 2010 was obtained for the client’s reference.

Important Ratios:

	2010	2010 Industry Financial Indices (461*)
Return on net assets (%)	45.65	13.44
Return on total assets (%)	38.66	5.47
Net profit margin (%)	27.58	6.81
Turnover of total assets	1.40	0.87
Turnover of current assets		2.11
Turnover days of account receivable		31.70
Inventory turnover days		45.06
Asset liability ratio (%)	15.30	58.11
Current ratio		0.98
Quick ratio		0.75

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

	2010
Main business income	960,700
Total profit	290,300
Net profit	265,000
Total assets	685,400
Total liabilities	104,900
Total owner’s interest	580,500
Source from	government
Whether audited or not	Yes

Analysis of financial indicator

All of SC’s financial indices of 2010 were all high due to its strong profitability. Low turnover of total assets indicates its asset operation capacity is weak. With low asset liability ratio, SC’s long-term solvency is strong.

INDUSTRY PROFILE

Industry

SIC Code (China): 2614 manufacture of organic chemical material

Description: manufacture of organic intermediate, HC and halogen derivative, alcohol, phenol and the derivative, ether, ketone, amides, organic phosphate, organic compound, salt etc.

Status Quo & Trend

China has become the largest manufacturer and exporter of fluorine chemical primary products. However, low research & development ability and technology make domestic fluorine chemical industry in a passive situation of low-end products surplus and high-end products shortage.

The world’s total productivity of fluoropolymer is about 220,000.00 tons per year. China’s productivity of fluoropolymer is 40,000 tons per year, occupying 80% of the world’s total productivity. China has become the second manufacturer of fluoropolymer.

Industry Associations

Name of association	Membership of subject (Yes/No)
Synthetic Organic Chemical Manufacture Association	Not Known
China Industry Association of Fluorine & Silicone Material	Not
Shanghai Organic Fluorine Research Institute	Not

GENERAL COMMENTS

Established in October, 2005, SC is engaged in research, development, manufacture and sales of HFC-134a, HFC-125, etc. Its products are mainly supplied to domestic and international automobile enterprises, refrigerator factories, etc. SC’s powerful shareholder can provide it with certain technology and capital supports. With large business scale, SC’s popularity in the local industry is keeping increasing.

SC’s main business income of 2010 was high due to its good business expanding. Generally speaking, its profitability is strong. SC’s asset operation capacity is poor. However, with low liability, its debt paying pressure is low.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.56.42
UK Pound	1	Rs.87.37
Euro	1	Rs.69.95

INFORMATION DETAILS

Report Prepared by :

PDT

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.