MIRA INFORM REPORT

Report Date :

14.06.2012

IDENTIFICATION DETAILS

Name :	JOTUN POWDER COATINGS [THAILAND] LTD.
Formerly Known As :	CORRO-COAT NOF [THAILAND] LTD.
Registered Office :	700/355 Moo 6, Amata Nakorn Industrial Estate, T. Donhuaroh, A. Muang, Cholburi 20000
Country :	Thailand
Financials (as on) :	31.12.2011
Date of Incorporation :	10.08.1977
Com. Reg. No.:	0105520011035
Legal Form :	Private Limited Company
Line of Business :	Manufacturer, Distributor and Exporter of Powder Coating
No. of Employees :	140

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)
Thailand	B1	B1

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

Company name

JOTUN POWDER COATINGS [THAILAND] LTD.

[ FORMER : CORRO-COAT NOF [THAILAND] LTD. ]

SUMMARY

BUSINESS ADDRESS : 700/355 MOO 6, AMATA NAKORN INDUSTRIAL

ESTATE, T. DONHUAROH, A. MUANG,

CHOLBURI 20000, THAILAND

TELEPHONE : [66] 38 468-744-5

FAX : [66] 38 214-266-7, 38 468-755-6

E-MAIL ADDRESS : wanics@jotun.com

suda.wanichkanjanakul@jotun.com

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED NO. : 1977

REGISTRATION : 0105520011035 [Former: 1104/2520]

TAX ID NO. : 3101005981

CAPITAL REGISTERED : BHT. 9,000,000

CAPITAL PAID-UP : BHT. 9,000,000

SHAREHOLDER’S PROPORTION : NORWEGIAN : 100%

FISCAL YEAR CLOSING DATE : DECEMBER 31

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MR. PORNCHAI PHAUNGSUWAN, THAI

MANAGING DIRECTOR & OPERATION MANAGER

NO. OF STAFF : 140

LINES OF BUSINESS : POWDER COATING

MANUFACTURER, DISTRIBUTOR AND EXPORTER

CORPORATE PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : GOOD WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH GOOD PERFORMANCE

HISTORY

The subject was established on August 10, 1977 as a private limited company under the registered name “Corrocoat [Thailand] Ltd.,” in order to produce powder coatings [Thermosetting Powder] for decorative and protective products industry, with the promotional privilege granted from the Board of Investment [BOI]. On November 5, 1995, the subject’s name was changed to “Corro-Coat NOF [Thailand] Ltd.”.

On July 2, 2001, its name was finally changed to JOTUN POWDER COATINGS [THAILAND] LTD. The subject is a subsidiary of Jotun Powder Coatings A/S, Norway. Subject currently employs approximate 140 staff.

The subject received ISO 9002 certificate from BVQI in 1996. The company is proud to be the first paint and powder coatings company in Thailand to receive the ISO 14001 certification from the Thailand Environmental Institute [TEI].

At present, Jotun Powder Coatings Group has the global networks of 40 companies in 30 countries.

The subject’s registered address is 700/355 Moo 6, Amata Nakorn Industrial Estate, T. Donhuaroh, A. Muang, Cholburi 20000, and this is the subject’s current operation address.

THE BOARD OF DIRECTORS

Name	Nationality	Age
Mr. Pornchai Phaungsuwan	Thai	50
Mr. Bjorn Skjelby	Norwegian	51
Mr. Gunnar Thoresen	Norwegian	62

AUTHORIZED PERSON

Any of the above directors can sign on behalf of the subject with company’s affixed.

MANAGEMENT

Mr. Pornchai Phaungsuwan is the Managing Director and Operation Manager.

He is Thai nationality with the age of 50 years.

Mr. Kobchai Nopkul is the Regional Laboratory Manager.

He is Thai nationality.

Mr. Siwapol Yangthong is the Production Manager.

He is Thai nationality.

Ms. Suda Wanichkanjanakul is the Marketing Manager.

She is Thai nationality.

Mr. Natthapong Panatsathien is the Logistic Manager.

He is Thai nationality.

Mrs. Punpen Chittasawangdee is the Human Resources & Purchasing Manager.

She is Thai nationality.

Ms. Sudjai Boonklong is the Financial Manager.

She is Thai nationality.

Mr. Akaraphon Tantikul is the Sales Manager.

He is Thai nationality.

BUSINESS OPERATIONS

The subject is engaged in developing, manufacturing and marketing of anticorrosion coatings comprising functional powder coatings and decorative powder coatings, primarily for use on a wide range of products, such as office furniture, home appliances, air-conditioners, computer, industrial pipelines [oil/gas/water] and reinforced concrete bars. Its products include powder coatings, epoxy powder, polyester powder and epoxy-polyester powder. It sold primarily to Original Equipment Manufacturers [OEMs].

PRODUCTION

8,000 tons/year [30 million litres/year]

MAJOR BRAND

“JOTUN”

IMPORT [COUNTRIES]

50% of raw materials and chemical are imported from Germany, Republic of China, Netherlands, Belgium, Singapore, Taiwan, Australia and Japan.

MAJOR SUPPLIERS

Company	Country	Product
Dow Chemical Thailand Ltd.	Thailand	Chemical
Louis T. Leonowens [Thailand] Ltd.	Thailand	Chemical
B A S F [Thai] Ltd.	Thailand	Chemical
Rohm & Haas Chemical [Thailand] Ltd.	Thailand	Chemical
Ateliers Susmeyer SA.	Belgium	Machinery
Dupont [Thailand] Ltd.	Thailand	Chemical

SALES [LOCAL]

80% of its products is sold locally to wholesalers and manufacturers.

EXPORT

20% of its products is exported to Australia, New Zealand, Hong Kong, Republic of China, Japan, Singapore, Malaysia, Taiwan, India, Indonesia, Philippines and United States of America.

MAJOR CUSTOMERS

Company	Country	Business Type
Mahajak Development Public Co., Ltd.	Thailand	Manufacturer of Air-Conditioning
Sanyo [Thailand] Co., Ltd.	Thailand	Manufacturer of Household Electrical Supplies
York Industrial [Thailand] Co., Ltd.	Thailand	Manufacturer of Air Conditioners
Unifab Equipment Co., Ltd.	Thailand	Manufacturer of Air Conditioners
Srithai Superware Public Co., Ltd.	Thailand	-
Hitachi [Thailand] Ltd.	Thailand	-
Rock Worth Public Co., Ltd.	Thailand	-
Philips Electronics [Thailand] Ltd.	Thailand	-
Kang Yong Electric Public Co., Ltd.	Thailand	-
Index Interfurn Co., Ltd.	Thailand	-

PARENT COMPANY

Jotun Powder Coatings A/S

Address : Sandefjord, Norway

SUBSIDIARY & AFFILIATED COMPANY

Jotun Thailand Ltd.

Business Type: Manufacturer and distributor of paints

LITIGATION

Bankruptcy and Receivership

There are no litigation on bankruptcy and receivership cases filed against the subject found at Legal Execution Department for the past five years.

Others

There are no legal suits filed against the subject for the past two years.

CREDIT

Sales are by cash or on the credits term of 30-60 days.

Local bills are paid by cash or on the credits term of 30-60 days.

Imports are by L/C at sight or T/T.

Exports are against L/C at sight or on the credit term of 120 days or T/T.

BANKING

The Siam Commercial Bank Public Co., Ltd.

[Ploenchit Branch : Maneeya Center Building, Ploenchit Rd., Lumpini, Pathumwan,

Bangkok 10330]

Bangkok Bank Public Co., Ltd.

[Head Office : 333 Silom Rd., Silom, Bangrak, Bangkok 10500]

EMPLOYMENT

The subject employs approximately 140 office staff and factory workers.

LOCATION DETAILS

The premise is owned for administrative office, factory and warehouse on 75,000 square meters of land at the heading address. Premise is located in an industrial area, in the Eastern region.

COMMENT

The company manufactures powder coatings of world-recognized standards, guaranteeing the same level of product quality and integrated expertise worldwide. Excellent technical support, intensive research, computerize ICT system, and valued added service enable the company to manufacture products that are tailored to meet all industrial aspects.

The subject’s business performance has outstanding improved since the first quarter of 2010.

FINANCIAL INFORMATION

The capital was registered at Bht. 3 million, divided into 3,000 shares of Bht. 1,000 each.

The capital was increased later as followings :

Bht. 6 million on September 28, 1979

Bht. 9 million on February 10, 1982

The latest registered capital was increased to Bht. 9 million, divided into 9,000 shares of Bht. 1,000 each with fully paid.

THE SHAREHOLDERS LISTED WERE : [as at April 18, 2012]

NAME	HOLDING	%
Jotun Powder Coatings A/S Nationality: Norwegian Address : Sandefjord, Norway	8,998	99.98
Mr. Bjorn Naglestad Nationality: Norwegian Address : Norway	1	0.01
Mr. Petder Bowlin Nationality: Norwegian Address : Norway	1	0.01

Total Shareholders : 3

Share Structure [as at April 18, 2012]

Nationality	Shareholders	No. of Share	% Shares
Thai	-	-	-
Foreign - Norwegian	3	9,000	100.00
Total	3	9,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO. :

Ms. Siriwan Surathepin No. 4604

BALANCE SHEET [BAHT]

The latest financial figures published for December 31, 2011 & 2010 were:

ASSETS

Current Assets	2011	2010
Cash and Cash Equivalents	75,206,786	38,820,777
Trade Accounts Receivable & Other Receivable	175,955,282	179,233,289
Inventories	207,908,718	126,318,443
Other Current Assets	7,406,810	24,696
Total Current Assets	466,477,596	344,397,205
Fixed Assets	105,838,302	80,403,244
Intangible Assets	184,322	378,983
Other Assets	114,500	75,900
Total Assets	572,614,720	425,255,332

LIABILITIES & SHAREHOLDERS' EQUITY [BAHT]

Current Liabilities	2011	2010
Short-term Loan from Financial Institution	-	90,000,000
Trade Accounts Payable & Other Payable	204,971,369	152,048,602
Accrued Income Tax	7,459,951	11,566,583
Other Current Liabilities	57,202	56,655
Total Current Liabilities	212,488,522	253,671,840
Long-term Loan from Related Company	150,000,000	-
Reserve for Employee Benefit	6,464,998	4,323,800
Total Liabilities	368,953,520	257,995,640
Shareholders' Equity
Share capital : Baht 1,000 par value authorized, issued and fully paid share capital 9,000 shares	9,000,000	9,000,000
Capital Paid	9,000,000	9,000,000
Statutory Reserve	900,000	900,000
Retained Earning - Unappropriated	193,761,200	157,359,692
Total Shareholders' Equity	203,661,200	167,259,692
Total Liabilities & Shareholders' Equity	572,614,720	425,255,332

PROFIT & LOSS ACCOUNT

Revenue	2011	2010
Sales	834,831,834	759,222,491
Other Income	17,610,947	16,435,845
Total Revenues	852,442,781	775,658,336
Expenses
Cost of Goods Sold	641,121,213	568,385,410
Selling Expenses	38,830,633	32,619,861
Administrative Expenses	114,757,197	96,690,613
Total Expenses	794,709,043	697,695,884
Profit before Financial Expenses & Income Tax	57,733,738	77,962,452
Financial Expenses	[3,675,991]	[2,133,084]
Profit before Income Tax	54,057,747	75,829,368
Income Tax	[17,656,239]	[22,177,933]
Net Profit / [Loss]	36,401,508	53,651,435

FINANCIAL ANALYSIS

ITEM	UNIT	2011	2010
LIQUIDITY RATIO
CURRENT RATIO	TIMES	2.20	1.36
QUICK RATIO	TIMES	1.18	0.86
ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	7.89	9.44
TOTAL ASSETS TURNOVER	TIMES	1.46	1.79
INVENTORY CONVERSION PERIOD	DAYS	118.37	81.12
INVENTORY TURNOVER	TIMES	3.08	4.50
RECEIVABLES CONVERSION PERIOD	DAYS	76.93	86.17
RECEIVABLES TURNOVER	TIMES	4.74	4.24
PAYABLES CONVERSION PERIOD	DAYS	116.69	97.64
CASH CONVERSION CYCLE	DAYS	78.60	69.64
PROFITABILITY RATIO
COST OF GOODS SOLD	%	76.80	74.86
SELLING & ADMINISTRATION	%	18.40	17.03
INTEREST	%	0.44	0.28
GROSS PROFIT MARGIN	%	25.31	27.30
NET PROFIT MARGIN BEFORE EX. ITEM	%	6.92	10.27
NET PROFIT MARGIN	%	4.36	7.07
RETURN ON EQUITY	%	17.87	32.08
RETURN ON ASSET	%	6.36	12.62
EARNING PER SHARE	BAHT	4,044.61	5,961.27
LEVERAGE RATIO
DEBT RATIO	TIMES	0.64	0.61
DEBT TO EQUITY RATIO	TIMES	1.81	1.54
TIME INTEREST EARNED	TIMES	15.71	36.55
ANNUAL GROWTH
SALES GROWTH	%	9.96
OPERATING PROFIT	%	(25.95)
NET PROFIT	%	(32.15)
FIXED ASSETS	%	31.63
TOTAL ASSETS	%	34.65

PROFITABILITY RATIO

Gross Profit Margin	25.31	Impressive	Industrial Average	18.80
Net Profit Margin	4.36	Impressive	Industrial Average	3.83
Return on Assets	6.36	Impressive	Industrial Average	4.89
Return on Equity	17.87	Impressive	Industrial Average	11.13

Gross Profit Margin used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. Gross profit margin serves as the source for paying additional expenses and future savings. The company’s figure is 25.31%. When compared with the industry average, the ratio of the company was higher, this indicated that company was more profitable than the same industry.

Net Profit Margin is the indicator of the company's efficiency in that net profit takes into consideration all expenses of the company. A low profit margin indicates a low margin of safety, higher risk that a decline in sales will erase profits and result in a net loss. The company’s figure is 4.36%, higher figure when compared with those of its average competitors in the same industry, indicated that business was an efficient operator in a dominant position within its industry.

Return on Assets measures how efficiently profits are being generated from the assets employed in the business when compared with the ratios of firms in a similar business. A low ratio in comparison with industry averages indicates an inefficient use of business assets. Return on Assets ratio is 6.36%, higher figure when compared with those of its average competitors in the same industry, indicated that business was an efficient profit in a dominant position within its industry.

Return on Equity indicates how profitable a company is by comparing its net income to its average shareholders' equity, ROE measures how much the shareholders earned for their investment in the company. Return on Equity ratio is 17.87%, higher figure when compared with those of its average competitors in the same industry, indicated that business was an efficient profit in a dominant position within its industry.

Trend of the average competitors in the same industry for last 5 years

Return on Assets Downtrend

Return on Equity Downtrend

LIQUIDITY RATIO

Current Ratio	2.20	Impressive	Industrial Average	1.58
Quick Ratio	1.18
Cash Conversion Cycle	78.60

The Current Ratio is to ascertain whether a company's short-term assets are readily available to pay off its short-term liabilities. The company's figure is 2.2 times in 2011, increased from 1.36 times, then it is generally considered to have good short-term financial strength. When compared with the industry average, the ratio of the company was higher, indicated that company was an efficient operator in a dominant position within its industry.

The Quick Ratio is a liquidity indicator that further refines the current ratio by measuring the amount of the most liquid current assets there are to cover current liabilities. The company's figure is 1.18 times in 2011, increased from 0.86 times, although excluding inventory so the company still have good short-term financial strength.

The Cash Conversion Cycle measures the number of days a company's cash is tied up in the production and sales process of its operations and the benefit from payment terms from its creditors. It meant the company could survive when no cash inflow was received from sale for 79 days.

Trend of the average competitors in the same industry for last 5 years

Current Ratio Uptrend

LEVERAGE RATIO

Debt Ratio	0.64	Acceptable	Industrial Average	0.54
Debt to Equity Ratio	1.81	Risky	Industrial Average	1.16
Times Interest Earned	15.71	Impressive	Industrial Average	6.99

Debt to Equity Ratio a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. A lower the percentage means that the company is using less leverage and has a stronger equity position.

Times Interest Earned measuring a company's ability to meet its debt obligations. Ratio is 15.71 higher than 1, so the company can pay interest expenses on outstanding debt.

Debt Ratio shows the proportion of a company's assets which are financed through debt. The company's figure is 0.64 greater than 0.5, most of the company's assets are financed through debt.

Trend of the average competitors in the same industry for last 5 years

Debt Ratio Downtrend

Times Interest Earned Uptrend

ACTIVITY RATIO

Fixed Assets Turnover	7.89	Impressive	Industrial Average	4.15
Total Assets Turnover	1.46	Impressive	Industrial Average	1.28
Inventory Conversion Period	118.37
Inventory Turnover	3.08	Acceptable	Industrial Average	4.75
Receivables Conversion Period	76.93
Receivables Turnover	4.74	Impressive	Industrial Average	3.09
Payables Conversion Period	116.69

Trend of the average competitors in the same industry for last 5 years

Fixed Assets Turnover Downtrend

Total Assets Turnover Downtrend

Inventory Turnover Downtrend

Receivables Turnover Downtrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.85
UK Pound	1	Rs.86.88
Euro	1	Rs.69.88

INFORMATION DETAILS

Report Prepared by :

PRL

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%)

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