MIRA INFORM REPORT

Report Date :

15.05.2012

IDENTIFICATION DETAILS

Name :	DOOSAN ENGINE CO., LTD.
Formerly Known As :	HSD ENGINE CO., LTD.
Registered Office :	69-3, Sinchon-dong, Changwon-si, Gyeongsangnam-do, Korea, Zip Code 641-370
Country :	South Korea
Financials (as on) :	31.12.2011
Date of Incorporation :	30.12.1999
Com. Reg. No.:	609-81-40128
Legal Form :	Listed Company
Line of Business :	Manufacturer of Internal Combustion Piston Engines
No. of Employees :	1,283

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 :	Exists

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)
South Korea	A1	A1

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

Basic

Company Name	DOOSAN ENGINE CO., LTD. (Korean Company Name : “두산엔진(주)”)
Registered Address	69-3, Sinchon-dong, Changwon-si, Gyeongsangnam-do, Korea
Zip Code	641-370
Tel	+82-55-260-6000
Fax	+82-55-282-0588
E-mail	wookyu.kim@doosan.com;humjin.baek@doosan.com
Website	www.doosanengine.com
Trading Address	69-3, Sinchon-dong, Changwon-si, Gyeongsangnam-do, Korea
Tel	+82-55-260-6000
Fax	+82-55-282-0588
Other Address-Geoje Office	1, Aju-dong ,Geoje-si, Gyeongsangnam-do, Korea
Tel	+82-55-682-2261
Fax	+82-55-681-7427
Other Address-Busan Office	29, Bongnae-dong 5-ga ,Yeongdo-gu, Busan, Korea
Tel	+82-51-417-1388
Fax	+82-51-410-8621
Type	Export
Industry	Manufacture of Internal Combustion Piston Engines
Main Business	Diesel Engine
Established (mm/dd/yyyy)	12/30/1999

The Subject owns the premises of Registered Address/Factory.

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Engines(26101500)
Sell	Diesel power plants(26131501)
Sell	Crankshaft
Sell	Turbocharger

CEO’s

Name	Cho Nam-Seok
Date of Birth	10/05/1959
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

69,500,000,000

Employees

1,283

Formation

Listed Company (Korea Stock Exchange : 082740) as of 01/05/2011

A Company of DOOSAN GROUP

Bank Details

Korea Exchange Bank-Changwon Branch

Corporate Registered No.

194211-0038423

Business Registered No.

609-81-40128

Permit & Licenses

Int’l Trade No.: 24023803

Shareholder Position

Name	Shares	%
DOOSAN HEAVY INDUSTRIES & CONSTRUCTION CO.,LTD(194211-0000943)	29,650,000	42.66
SAMSUNG HEAVY INDUSTRIES CO.,LTD(110111-0168595)	9,815,000	14.12
DAEWOO SHIPBUILDING & MARINE ENGINEERING CO., LTD.(110111-2095837)	5,600,000	8.06
EMPLOYEE STOCK OWNERSHIP ASSOCIATION	2,951,563	4.25
OTHERS	21,483,437	30.91
TOTAL	69,500,000	100.00

Company History

The engine business of Doosan Heavy Industries & Construction (former Hanjung), launched in 1983 and that of Samsung Heavy Industries, launched in 1994 were merged. In the merging process, Daewoo Shipbuilding & Marine Engineering joined this new company as a major shareholder. On January 1, 2000, Doosan Engine was officially set up under the banner of Doosan with the first initial letters of these three companies(HSD ENGINE CO., LTD.)

12/30/1999 Incorporated as HSD ENGINE CO., LTD.

03/2005 Changed company name to the present name

11/2005 Awarded US$500 Million Export Top Prize

11/2007 Awarded 1Billion Export Top Prize

12/29/2009 Increased capital to 62,500,000,000 KRW from 30,000,000,000 KRW

Management

Job Description	Title	Name	Nationality	Date of Birth	Education
President & CEO	Mr.	Cho Nam-Seok	Korean	1959.10.05	Korea University, Korea
Executive Director	Mr.	Nam Sang-Min	Korean	1955.04.01	-
Executive Director	Mr.	Kim Jeong-Kwon	Korean	1955.06.30	Youngnam University, Korea
Vice President & CFO	Mr.	Choi Jong-Il	Korean	1956.09.25	Kyunghee University, Korea
Outside Director	Mr.	Oh Se-Jong	Korean	1943.06.08	UC Berkley, USA
Outside Director	Mr.	Jung Koo-Young	Korean	1938.11.12	Yonsei University, Korea
Outside Director	Mr.	Song Kyung-Soon	Korean	1951.01.14	George Washington University, USA
Outside Director	Mr.	Yoon Dong-Min	Korean	1945.04.04	Washington University, USA
Outside Director	Mr.	Hwang Byung-Ki	Korean	1949.01.23	-
Outside Director	Mr.	Joo Jong-Nam	Korean	1956.08.17	-

Financials

Year / Unit : KRW	Sales	Assets	Net Income
(*)2011	2,003,793,072,593	2,051,480,611,768	209,636,479,757
(*)2010	1,831,615,390,618	2,229,611,103,972	266,059,737,115
2009	1,772,597,107,485	2,464,900,272,093	-249,695,256,019
2008	1,734,836,578,853	3,138,764,982,205	-512,779,968,953
2007	1,221,957,444,340	1,857,689,988,086	103,001,092,083
2006	1,016,816,117,889	934,211,090,107	52,418,002,030
2005	756,782,214,023	737,005,633,136	21,111,237,395
2004	588,395,875,988	637,788,986,998	3,111,534,708
2003	468,249,817,815	336,826,737,075	11,783,531,830

(*)2010 & 2011 ‘s figures are based on the K-IFRS Accounting System.

Financial Description

Authorized Capital(KRW)	120,000,000,000
Paid-Up Capital(KRW)	69,500,000,000
Total Issues Shares	69,500,000

Balance Sheet
Unit : Korean Won	As of 12/31/2011	As of 12/31/2010	As of 12/31/2009
Total Assets	2,051,480,611,768	2,229,611,103,972
Current Assets	982,127,630,841	1,066,128,436,674
Cash & Cash Equivalents	320,469,576,651	336,877,478,529
Trade Receivables & Other Receivables	171,702,355,734	139,049,982,451
Current Financial Instruments	147,862,076,202	150,958,650,000
Derivatives	8,153,605,085	36,255,228,375
Confirmed Contracts	66,708,349,474	84,638,958,348
Inventories	247,231,575,247	296,560,703,196
Current Non-Financial Instruments	20,000,092,448	21,787,435,775
Non-Current Assets	1,069,352,980,927	1,163,482,667,298
Long-Term Trade Receivables & Other Receivables	11,952,731,636	52,219,175,528
Equity Method Investment	365,024,719,731	367,796,243,437
Tangibles	551,384,215,311	561,120,529,590
Investment_Real Estates	36,130,101,804	17,902,709,338
Intangibles	14,536,132,373	4,975,669,763
Deferred Income Tax Assets		20,377,108,529
Non-Current Financial Instruments	11,613,959,581	17,382,361,342
Non-Current Derivatives	3,752,006,943	16,352,413,066
Non-Current Confirmed Contracts	74,959,113,548	105,356,456,705
Total Liabilities	1,461,182,444,094	1,847,539,981,391
Current Liabilities	1,207,088,087,624	1,487,026,897,149
Trade Payables & Other Payables	950,376,799,288	1,280,539,619,214
Advance Receipt Construction	34,079,376,921	19,705,746,669
Short-Term Borrowings	23,306,698,323	33,450,569,261
Current Portion of Long-Term Debts	69,198,000,000	68,334,000,000
Income Taxes	6,426,973,157
Current Derivatives	33,080,119,987	12,715,460,127
Current Confirmed Contracts	6,933,180,782	18,238,751,601
Other Current Non-Financial Debts	3,741,394,564	4,054,291,242
Current Portion of Debentures	79,945,544,602	49,988,459,035
Non-Current Liabilities	254,094,356,470	360,513,084,242
Long-Term Borrowings	138,396,000,000	205,002,000,000
Debentures		79,765,291,428
Long-Term Account Payables	2,332,156,206
Provision for Severance & Retirement	26,590,315,593	18,961,166,192
Non-Current Derivatives	17,936,849,494	8,861,426,127
Non-Current Confirmed Contracts	5,002,643,700	15,312,351,611
Finance Guarantee	349,001,248	16,151,120,082
Provision for Repairing	20,507,108,230	16,459,728,802
Deferred Income Tax Credit	42,980,281,999
Capital Stock	69,500,000,000	69,500,000,000
Others	367,016,357,075	365,129,157,101
Profit Surplus	153,781,810,599	-52,558,034,520
Total Equity	590,298,167,674	382,071,122,581
Liab. & Shareholder’s Equity	2,051,480,611,768	2,229,611,103,972

Balance Sheet
Unit : Korean Won	As of 12/31/2010	As of 12/31/2009	As of 12/31/2008
Total Assets	1,943,509,746,249	2,464,900,272,093	3,138,764,982,205
Current Assets	936,599,017,908	922,129,267,661	1,497,026,556,805
-Quick Assets	896,278,655,608	856,897,709,732	1,359,916,482,771
-Inventories	40,320,362,300	65,231,557,929	137,110,074,034
Fixed Assets	1,006,910,728,341	1,542,771,004,432	1,641,738,425,400
-Investment	247,315,097,554	563,860,333,880	759,189,784,011
-Tangibles	570,528,684,951	601,583,837,914	535,336,040,647
-Intangibles	1,040,481,258	1,279,210,156	1,527,799,804
Others	188,026,464,578	376,047,622,482	345,684,800,938
Total Liabilities	1,604,194,079,925	2,386,662,909,324	3,089,520,590,645
Current Liabilities	1,210,783,882,314	1,992,608,988,744	2,237,669,754,014
Fixed Liabilities	393,410,197,611	394,053,920,580	851,850,836,631
Capital Stock	69,500,000,000	62,500,000,000	30,000,000,000
Capital Surplus	367,214,701,425	242,622,751,092	-
Profit Surplus	-359,093,775,949	-524,361,975,594	-274,230,609,809
Capital Adjustment	261,694,740,848	297,476,587,271	293,475,001,369
Total Equity	339,315,666,324	78,237,362,769	49,244,391,560
Liab. & Shareholder’s Equity	1,943,509,746,249	2,464,900,272,093	3,138,764,982,205

Current Liabilities	1,210,783,882,314	1,992,608,988,744	2,237,669,754,014
Trade Payables	203,022,661,292	217,143,916,021	270,943,113,809
Account Payables	12,051,896,957	15,964,426,756	35,028,856,913
Short-Term Borrowings	-	25,735,308,617	38,742,893,091
Advance Receipts	762,999,643,584	919,060,087,889	937,351,918,747
Withholdings	3,100,671,187	6,637,615,377	1,006,862,643
Accrued Expenses	87,719,318,989	91,076,154,747	102,480,654,052
Current Portion of Long-Term Borrowings	68,334,000,000	70,056,000,000	900,000,000
Current Portion of Derivatives	12,715,460,127	206,123,090,188	851,215,454,759
Current Portion of Confirmed Agreement Debts	10,840,230,178	2,062,408,537	-
Current Portion of Deferred Income Tax Credit	-	28,749,980,612	-
Current Portion of Debentures	50,000,000,000	410,000,000,000	-
Fixed Liabilities	393,410,197,611	394,053,920,580	851,850,836,631
Debentures	80,000,000,000	50,000,000,000	180,000,000,000
Long-Term Borrowings	205,002,000,000	280,224,000,000	377,250,000,000
Leasehold Deposit Received	953,620,055	1,009,962,010	764,030,000
Provision for Repairing	14,452,320,049	21,139,414,533	30,127,242,797
Provision for Construction Loss	23,948,825,166	4,926,809,069	23,011,120,768
Non Current Portion of Derivatives	8,861,426,127	21,692,428,443	229,405,885,326
Non-Current Portion of Confirmed Contract	8,174,038,131	1,811,218	-
Provision for Severance & Retirement	25,861,713,134	23,898,788,593	21,771,615,925
Non-Current Portion of Deferred Income Tax Credit	33,168,794,621	-	-

Income Statement
Unit : Korean Won	As of 12/31/2011	As of 12/31/2010	As of 12/31/2009
Sales	2,003,793,072,593	1,831,615,390,618
Cost of Sold Goods	1,643,634,050,361	1,520,653,152,505
Gross Profit	360,159,022,232	310,962,238,113
Selling & Admin. Expenses	66,268,170,849	57,880,182,826
Other Operating Income	8,141,335,156	34,907,778,859
Other Operating Expenses	23,244,862,628	12,174,327,896
Operating Income	278,787,323,911	275,815,506,250
Finance Income	82,712,678,543	88,135,156,732
Finance Expenses	76,290,640,093	116,701,361,725
Other Income	-2,771,523,706	90,211,813,127
Income Before Taxes	282,437,838,655	337,461,114,384
Income Taxes Expenses	72,801,358,898	71,401,377,269
Net Income	209,636,479,757	266,059,737,115

Income Statement
Unit : Korean Won	As of 12/31/2010	As of 12/31/2009	As of 12/31/2008
Sales	1,730,068,104,088	1,772,597,107,485	1,734,836,578,853
Cost of Sold Goods	1,445,436,037,413	1,596,482,061,871	1,474,629,220,316
Gross Profit	284,632,066,675	176,115,045,614	260,207,358,537
Selling & Admin. Expenses	54,278,671,004	59,568,580,249	66,803,453,926
Operating Income	230,353,395,671	116,546,465,365	193,403,904,611
Non-Operating Income	265,653,104,945	432,501,041,770	365,572,184,634
Non-Operating Expenses	259,142,897,915	797,917,087,712	1,142,199,548,219
Income Before Taxes	236,863,602,701	-248,869,580,577	-583,223,458,974
Income Taxes Expenses	71,406,327,967	825,675,442	-70,443,490,021
Net Income	165,457,274,734	-249,695,256,019	-512,779,968,953

Cash Flows
Unit : Korean Won	As of 12/31/2011	As of 12/31/2010	As of 12/31/2009
Operating Activities Cash Flows	147,081,537,595	279,203,898,039
Net Income	209,636,479,757	266,059,737,115
Adjustment	-67,050,110,900	40,724,860,814
Interests Received	17,768,136,595	7,494,367,384
Interests Paid	-12,619,715,213	-35,142,027,438
Dividends Received	137,155,040	473,664,750
Income Taxes	-790,407,684	-406,704,586
Cash Flows from Investing	-34,920,081,023	155,424,902,619
Cash Flows from Financing	-128,477,870,938	-295,534,165,927
Increase/Decrease in Cash	-16,407,901,878	139,088,960,314
Cash at the Beginning of Year	336,877,478,529	197,788,518,215
Cash at the End of Year	320,469,576,651	336,877,478,529

Cash Flows
Unit : Korean Won	As of 12/31/2010	As of 12/31/2009	As of 12/31/2008
Cash Flows from Operating	277,919,757,934	-224,716,635,650	62,562,457,083
-Net Income	165,457,274,734	-249,695,256,019	-512,779,968,953
-Exp. without Cash Outflow	275,166,958,833	791,158,072,013	872,734,019,402
-Revenue without Cash Inflows	-202,999,547,112	-386,270,156,236	-323,523,074,492
-Changes in Asset/ & Liability	40,295,071,479	-379,909,295,408	26,131,481,126
Cash Flows from Investing	155,424,902,619	-162,499,565,248	-144,161,199,937
-Cash Inflow from Investing	315,851,880,454	2,872,437,129	60,450,683,992
-Cash Outflows for Investing	-160,426,977,835	-165,372,002,377	-204,611,883,929
Cash Flows from Financing	-294,255,700,239	541,497,040,817	15,227,518,985
-Cash Inflows from Financing	298,472,832,373	816,477,523,574	60,352,690,050
-Cash Outflows from Financing	-592,728,532,612	-274,980,482,757	-45,125,171,065
Increase/Decrease in Cash	139,088,960,314	154,280,839,919	-66,371,223,869
Cash at the Beginning of Year	197,788,518,215	43,507,678,296	109,878,902,165
Cash at the End of Year	336,877,478,529	197,788,518,215	43,507,678,296

Products, Technologies, Services Description

Main Products & Services

The Subject Company, an integrated engine manufacturer, is a business enterprise specializing in producing diesel engine for large vessels, called the heart of the sea and power generation.

Diesel Engine for Large Vessels

Marine Diesel Engine

Diesel Power Plant

Annual Production Capacity

(Unit: Thousand H/P)

Item	2010	2009	2008
Diesel Engine	14,000	14,000	14,000

Trade Partners & Competitors

Customers	SAMSUNG HEAVY INDUSTRIES CO.,LTD(110111-0168595) HANJIN HEAVY INDUSTRIES & CONSTRUCTION CO.,LTD (180111-0602507) DAEWOO SHIPBUILDING & MARINE ENGINEERING CO., LTD. (110111-2095837) DALIAN SHIPBUILDING INDUSTRY CO., LTD. SINOPACIFIC
Competitors	HYUNDAI HEAVY INDUSTRIES CO.,LTD(181211-0000386) STX ENGINE CO,.LTD(194211-0066763)

Related Parties

(Subsidiaries, Joint-Venture & Affiliates)

Affiliates-Domestic	DOOSAN CORPORATION(110111-0013774) DOOSAN HEAVY INDUSTRIES & CONSTRUCTION CO.,LTD(194211-0000943) DOOSAN INFRACORE CO., LTD.(120111-0234469) (6.03% held by the subject company) DOOSAN ENGINE CO., LTD(194211-0038423) DOOSAN MECATEC CO., LTD.(110111-0126022) N.SHAPER CO., LTD .(110111-1943574) ORICOM INC(110111-0176986) DOOSAN DONG-A CO., LTD.(110111-3977117) DOOSAN CO., LTD.(110111-0013774) SRS KOREA CO., LTD.(110111-3139733) DOOSAN FEED & LIVESTOCK CO., LTD.(110111-3809138) DOOSAN WINE SALES CO., LTD.(110111-3942582) SAMHWA CROWN & CLOSURE CO., LTD.(134111-0003462) DOOSAN MOTTROL CO., LTD.(194211-0000274) DOOSAN CONSTRUCTION & ENGINEERING CO., LTD.(110111-0194277) NEO TRANS CO., LTD.(131111-0141801) DOOSAN TOWER CO., LTD.(110111-1722499) DOOSAN MOTORS CORP.(110111-3008293) DONG HYUN ENGINEERING CO., LTD.(110111-0508329) NEOPLUX CO., LTD.(110111-1927841) DOOSAN CAPITAL CO., LTD.(110111-1220336) 19.99% BIG & GOOD SECURITIES BROKERAGE.CO., LTD.(110111-1965560) REXCON CO., LTD.(110111-3586273) DOOSAN CUVEX CO., LTD(140111-00325709) DOOSAN BEARS INC(110111-0346919) DOOSAN MOTTROL HOLDINGS CO., LTD.(110111-3892505) DIP HOLDINGS CO., LTD.(110111-4103076) CASCO CO., LTD.(210111-0047938) (16.21% held by the subject company)
Affiliates-Overseas	DOOSAN MARINE INDUSTRY (DALIAN) CO., LTD. DAGUSHAN NANGANG INDUSTRY PARK, DEVELOPMENT ZONE, DALIAN, P.R. CHINA TEL :+86 411 8751 7957 FAX :+86 411 8751 7956 DALIAN SAMYOUNG DOOSAN METAL PRODUCT CO., LTD. (20.66% held by the subject company) DOOSAN HOLDINGS EUROPE LTD. (21.73% held by the subject company) DOOSAN INFRACORE INTERNATIONAL, INC. (20.93% held by the subject company)
Overseas Office	EUROPE BRANCH HEIDENKAMPSWEG, 100, 8. OG 20097 HAMBURG, GERMANY TEL:+49-40-2533-5656 FAX:+49-40-2533-5661 SINGAPORE BRANCH 78, SHENTON WAY, #16-04, SINGAPORE 079120 TEL:+65-6222-5515 FAX:+65-6222-5525 SHANGHAI BRANCH 828, HUA DU MANSION 14F 1200M E, ZHANG YANG ROAD, PUDONG, SHANGHAI, CHINA TEL: 22-6875-0876 FAX: 22-6875-0864 DALIAN HANJUNG-DMD INDUSTRY CO., LTD. (CHINA)
Subsidiary	DOOSAN MARINE INDUSTRY (DALIAN) CO., LTD. (100.0% held by the subject company)
Cooperative Enterprise	-Technical Support from MAN DIESEL A/S WARTSILA MAN DIESEL SE SEMT PIELSTICK MITSUBISHI HEAVY INDUSTRIES ABB TURBO SYSTEM -Insured Company DONGBU INSURANCE CO., LTD.(110111-0095285) MERITZ FIRE & MARINE INSURANCE CO., LTD.(110111-0013328)

Sales by Region

(Activity & Markets)

Sales/ Unit : KRW	2010	2009	2008
Export	1,662,011,000,000	1,662,960,876,756	1,668,434,187,027
Domestic	68,057,000,000	109,636,230,729	66,402,391,826
Total	1,730,068,000,000	1,772,597,107,485	1,734,836,578,853

The Subject exports to China and Europe.

Court Action

Case No.	Court	Plaintiff(s)/ Creditor(s)/ Applicant(s)	Defendant(s)/ Debtor(s)/ Respondent(s)	Cause	Amount (KRW)	Status
	Seoul Nambu District Court	JINDO CO., LTD.(110111-3411024)	The Subject Company	-	3,000,000,000	1st round is proceeding
	Changwon District Court	C&HEAVY INDUSTRIES CO.,LTD.( 110111-0302440)	The Subject Company	Promissory Notes	56,700,000	Proceeding
	Court in Greece	GAEI	The Subject Company	Related to Chios Diesel Power Plant	Euro3,059,635	Proceeding

News Clipping

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FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.53.71
UK Pound	1	Rs.86.34
Euro	1	Rs.69.23

INFORMATION DETAILS

Report Prepared by :

MNL

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.