MIRA INFORM REPORT

Report Date :

22.11.2012

IDENTIFICATION DETAILS

Name :	Weifang Lu’an Import AND Export co., Ltd.
Registered Office :	No. 35 Weixu North Road, Anqiu, Weifang, Shandong Province, 262100 Pr
Country :	China
Financials (as on) :	31.12.2010
Date of Incorporation :	19.03.2008
Com. Reg. No.:	370784200000830
Legal Form :	One-Person Limited Liability Company
Line of Business :	Subject is engaged in international trade like various medicines, paper, wood pulp, etc.
No. of Employees :	15

RATING & COMMENTS

MIRA’s Rating :

B

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

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 – June 30^th, 2012

Country Name	Previous Rating (31.03.2011)	Current Rating (30.06.2012)
China	A2	A2

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

china - ECONOMIC OVERVIEW

Since the late 1970s China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role - in 2010 China became the world's largest exporter. Reforms began with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, creation of a diversified banking system, development of stock markets, rapid growth of the private sector, and opening to foreign trade and investment. China has implemented reforms in a gradualist fashion. In recent years, China has renewed its support for state-owned enterprises in sectors it considers important to "economic security," explicitly looking to foster globally competitive national champions. After keeping its currency tightly linked to the US dollar for years, in July 2005 China revalued its currency by 2.1% against the US dollar and moved to an exchange rate system that references a basket of currencies. From mid 2005 to late 2008 cumulative appreciation of the renminbi against the US dollar was more than 20%, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing allowed resumption of a gradual appreciation. The restructuring of the economy and resulting efficiency gains have contributed to a more than tenfold increase in GDP since 1978. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2010 stood as the second-largest economy in the world after the US, having surpassed Japan in 2001. The dollar values of China's agricultural and industrial output each exceed those of the US; China is second to the US in the value of services it produces. Still, per capita income is below the world average. The Chinese government faces numerous economic challenges, including: (a) reducing its high domestic savings rate and correspondingly low domestic demand; (b) sustaining adequate job growth for tens of millions of migrants and new entrants to the work force; (c) reducing corruption and other economic crimes; and (d) containing environmental damage and social strife related to the economy's rapid transformation. Economic development has progressed further in coastal provinces than in the interior, and by 2011 more than 250 million migrant workers and their dependents had relocated to urban areas to find work. One consequence of population control policy is that China is now one of the most rapidly aging countries in the world. Deterioration in the environment - notably air pollution, soil erosion, and the steady fall of the water table, especially in the North - is another long-term problem. China continues to lose arable land because of erosion and economic development. The Chinese government is seeking to add energy production capacity from sources other than coal and oil, focusing on nuclear and alternative energy development. In 2010-11, China faced high inflation resulting largely from its credit-fueled stimulus program. Some tightening measures appear to have controlled inflation, but GDP growth consequently slowed to near 9% for 2011. An economic slowdown in Europe is expected to further drag Chinese growth in 2012. Debt overhang from the stimulus program, particularly among local governments, and a property price bubble challenge policy makers currently. The government's 12th Five-Year Plan, adopted in March 2011, emphasizes continued economic reforms and the need to increase domestic consumption in order to make the economy less dependent on exports in the future. However, China has made only marginal progress toward these rebalancing goals.

Source : CIA

Company Name and Address

WEIFANG LU’AN IMPORT AND EXPORT CO., LTD.

NO. 35 WEIXU NORTH ROAD, ANQIU, WEIFANG,

SHANDONG PROVINCE, 262100 PR CHINA

TEL: 86(0) 536-4390070/4382798 FAX: 86 (0) 536-4390690

EXECUTIVE SUMMARY

INCORPORATION DATE : MARCH 19, 2008

REGISTRATION NO. : 370784200000830

REGISTERED LEGAL FORM : ONE-PERSON LIMITED LIABILITY COMPANY

CHIEF EXECUTIVE : MR. WANG JUN (CHAIRMAN)

STAFF STRENGTH : 15

REGISTERED CAPITAL : CNY 1,000,000

BUSINESS LINE : TRADING

TURNOVER : CNY 236,749,000 (AS OF DEC. 31, 2010)

EQUITIES : CNY 7,140,000 (AS OF DEC. 31, 2010)

PAYMENT : AVERAGE

MARKET CONDITION : AVERAGE

FINANCIAL CONDITION : FAIRLY STABLE

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.23 = USD 1

Adopted abbreviations:

ANS - amount not stated

NS - not stated

SC - subject company (the company inquired by you)

NA - not available

CNY - China Yuan Renminbi

SC was registered as a one-person limited liability company at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on March 19, 2008.

Company Status: One-person Limited Liability Company

Single person LLC refers to a limited liability company set up by only one natural person or legal person as the single shareholder of it.

The minimum registered capital of Single person LLC is CNY100,000. The shareholder’s capital contributes, as set out by the articles of associations should be a lump-sum payment in full.

One natural person can only invest in and set up one limited liability company, which is not permitted to invest in and set up a new Single person LLC.

As to any one-person limited liability company, the sole-investor nature of the natural person or legal person shall be indicated in the registration documents of the company and shall be indicated in the business license thereof as well.

The regulation of Single person LLC should be set up by the shareholder

The regulation of Single person LLC has no shareholder meeting.

SC’s registered business scope includes importing and exporting commodities and technologies, excluding export commodities limited or prohibited by the state (with permit if needed).

SC is mainly engaged in international trade.

Mr. Wang Jun has been legal representative and chairman of SC since 2008.

SC is known to have approx. 15 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office in the commercial zone of Anqiu. Our checks reveal that SC rents the total premise, but SC’s accountant refused to release the gross area of the premise.

SC is not known to host website of its own at present.

No significant events or changes were found during our checks with the local Administration for Industry and Commerce.

MAIN SHAREHOLDERS:

Name % of Shareholding

Anqiu Lu’An Pharmaceutical Co., Ltd. 100

Anqiu Lu'an Pharmaceutical Co., Ltd. (Former: Weifang No. 4 Pharmaceutical Factory) is the largest Asian bulk pharmaceutical enterprises specializing in producing and exporting Paracetamol (Acetaminophen) (annual capacity is 24,000 tons), Paracetamol DC (DC90, DC96, DC85, DC83, DC77 etc) (annual capacity is 5000 tons) and contract manufacture of Paracetamol Finish Dosage including Paracetamol Codeine (Tablet, Caplet, Hard Capsule and Soft Capsule) and Health Ingredients and Healthcare Products (annual capacity 8 billion tabs).

Web: http://www.luanpharm.com/

E-mail: luan@luanpharm.com

Add: No. 35 Weixu North Road, Anqiu, Shandong Province

Tel: 86 (0) 536-4390060

Fax: 86 (0) 536-4390238

l Legal representative and chairman:

Mr. Wang Jun, in his 40’s, with university education. He is currently responsible for the overall management of SC.

Working Experience(s):

From 2008 to present Working in SC as legal representative and chairman.

SC is mainly engaged in international trade.

Main Products: various medicines, paper, wood pulp, etc.

SC sources its materials 90% from domestic market, and 10% from overseas market. SC sells 30% of its products in domestic market, and 70% to overseas market.

The buying terms of SC include Check, T/T, L/C and Credit of 30-60 days. The payment terms of SC include Check, T/T, L/C and Credit of 30-60 days.

Note: SC refused to release its major suppliers and clients.

SC is not known to have any subsidiary at present.

Overall payment appraisal:

( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet 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.

We could not find the bank information on SC in local AIC.

Financial Summary

Unit: CNY’ 000	as of Dec. 31, 2010	as of Dec. 31, 2009
Total liabilities	35,909	20,909
Shareholders equities	7,140	4,211
	---------------	---------------
Total assets	43,049	25,120
	==========	==========
Turnover	236,749	223,195
Profit before tax	3,905	3,997
Less: Profit tax	976	999
Net profit	2,929	2,998

Note: we did not find SC’s detailed financial reports at local AIC for year 2009 and 2010.

Important Ratios

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

	as of Dec. 31, 2010	as of Dec. 31, 2009
*Liabilities to assets	0.83	0.83
*Net profit margin (%)	1.24	1.34
*Return on total assets (%)	6.80	11.93
*Turnover/Total assets	5.50	8.89

PROFITABILITY: FAIRLY GOOD

l The turnover of SC appears fairly good in its line.

l SC’s net profit margin appears average in both 2 years.

l SC’s return on total assets appears good in both 2 years.

l SC’s turnover is in a fairly good level in both 2 years, comparing with the size of its total assets.

LEVERAGE: FAIR

l The debt ratio of SC is fairly high in both 2 years.

l The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly Stable.

SC is considered small-sized in its line with fairly stable financial conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.20
UK Pound	1	Rs.87.79
Euro	1	Rs.70.43

INFORMATION DETAILS

Report Prepared by :

NIT

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.