MIRA INFORM REPORT

Report Date :

28.11.2012

IDENTIFICATION DETAILS

Name :	PARKER HANNIFIN [THAILAND] CO., LTD.
Registered Office :	1265 Rama 9 Road, Suanluang, Bangkok 10250
Country :	Thailand
Financials (as on) :	30.06.2012
Date of Incorporation :	27.12.1995
Reg. No.:	0105538150452
Legal Form :	PRIVATE LIMITED COMPANY
Line of Business :	Manufacturer, Importer and Distributor of Motion and Control System Equipment
No. of Employees :	260

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 – June 30^th, 2012

Country Name	Previous Rating (31.03.2011)	Current Rating (30.06.2012)
Thailand	B1	B1

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

thailand - ECONOMIC OVERVIEW

With a well-developed infrastructure, a free-enterprise economy, generally pro-investment policies, and strong export industries, Thailand enjoyed solid growth from 2000 to 2007 - averaging more than 4% per year - as it recovered from the Asian financial crisis of 1997-98. Thai exports - mostly machinery and electronic components, agricultural commodities, and jewelry - continue to drive the economy, accounting for more than half of GDP. The global financial crisis of 2008-09 severely cut Thailand's exports, with most sectors experiencing double-digit drops. In 2009, the economy contracted 2.3%. In 2010, Thailand's economy expanded 7.8%, its fastest pace since 1995, as exports rebounded from their depressed 2009 level. Steady economic growth at just below 4% during the first three quarters of 2011 was interrupted by historic flooding in October and November in the industrial areas north of Bangkok, crippling the manufacturing sector and leading to a revised growth rate of only 0.1% for the year. The industrial sector is poised to recover from the second quarter of 2012 onward, however, and the government anticipates the economy will probably grow between 5.5 and 6.5% for 2012, while private sector forecasts range between 3.8% and 5.7%.

Source : CIA

COMPANY NAME AND ADDRESS

PARKER HANNIFIN [THAILAND] CO., LTD.

SUMMARY

BUSINESS ADDRESS : 1265 RAMA 9 ROAD, SUANLUANG,

BANGKOK 10250

TELEPHONE : [66] 2186-7000-9

FAX : [66] 2374-1645

E-MAIL ADDRESS : phthailand@parker.com

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 1995

REGISTRATION NO. : 0105538150452

TAX ID NO. : 3011685914

CAPITAL REGISTERED : BHT. 93,950,000

CAPITAL PAID-UP : BHT. 93,950,000

SHAREHOLDER’S PROPORTION : FOREIGN : 100%

FISCAL YEAR CLOSING DATE : JUNE 30

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MR. PRACHARAK ITTHIVIBUL, THAI

GENERAL MANAGER & FACTORY MANAGER

NO. OF STAFF : 260

LINES OF BUSINESS : MOTION AND CONTROL SYSTEM EQUIPMENT

MANUFACTURER, IMPORTER AND DISTRIBUTOR

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 December 27, 1995 as a private limited company under the name style PARKER HANNIFIN [THAILAND] CO., LTD., by American groups, with the business objective originally to import and distribute industrial valves and pipe fittings to domestic market. Subject currently expanded its business to manufacture motion and control systems equipments for industrial sector. It currently employs approximate 260 staff.

It achieved the standard ISO 9001 : 2000 certification by Lloyd’s Register Quality Assurance Limited and also ISO/TS 16949 : 2002 for fuel filter [assembly line], under the standard of IATF.

Subject is a wholly owned subsidiary of Parker Hannifin Corporation, U.S.A.

The subject’s registered address was initially located at 1023 TPS Bldg., Pattanakarn Rd., Suanluang, Bangkok 10250.

On March 18, 2011, its registered address was relocated to 1265 Rama 9 Road, Suanluang, Bangkok 10250, and this is the subject’s current operation address.

THE BOARD OF DIRECTOR

Name		Nationality	Age
Mr. Craig Lewis Bowersox	[x]	American	56
Mr. Pracharak Itthivibul		Thai	40
Mr. Yoon Chung		American	49

AUTHORIZED PERSON

The mentioned director [x] signs or both of the rest directors can jointly sign on behalf of the subject with company’s affixed.

MANAGEMENT

Mr. Pracharak Itthivibul is the General Manager and Factory Manager.

He is Thai nationality with the age of 40 years old.

Mr. Nisit Charoensuk is the Sales Manager.

He is Thai nationality.

Ms. Somjai Thongkouw is the Human Resources Manager.

She is Thai nationality.

BUSINESS OPERATIONS

The subject’s main activities are importer and distributor wide range of products, concentrate in the motion and control components and systems, which were divided into 7 main products, e.g. Pneumatics, Hydraulics, Filtration, Fluid Connectors, Climate & Industrial Control, Instrumentation and Seals & O-rings, supply to customers in industrial of automotive, air conditioning and refrigeration, tire, oil and gas, light and heavy industry, marine, mining, food & beverage, transportation, petrochemical, pharmaceutical, power plant, refinery and etc.

Ranges of products are as follows:

Aerospace components and systems

Automation components and controls

Hose fittings, tubing, couplers and equipment

Hydraulic systems and components

Hydraulic, pneumatic, fuel filters and elements

Instrumentation tubing, fittings, valves

O-ring, shielding, sealing, gasket products

Refrigeration valves and controls

Subject is also a manufacturer and supplier of motion and control systems equipment, mainly as filter for industrial machinery, diesel and benzene engines.

BRAND NAME

“PARKER”

PRODUCTION CAPACITY

1,000,000 units per annum

PURCHASE

20% of raw materials is purchased from local suppliers.

IMPORT

80% of the products is imported from U.S.A., Singapore, Republic of China, Taiwan, Japan and Germany.

MAJOR SUPPLIER

Parker Hannifin Corporation. : U.S.A.

SALES

100% of the products is sold locally by wholesale to manufacturers and end-users, in the field of automobiles, air conditioners, refrigerators, tires, oil & gas, lighting & heavy industry, marine, mining, power plant, foods & beverage, transportation, petrochemical, pharmaceuticals and etc.

MAJOR CUSTOMERS

Analytical and Control Technology Ltd. : Thailand

Abex Hydraulics & Engineering Co., Ltd. : Thailand

Parker Southern Store Co., Ltd. : Thailand

SUBSIDIARY AND AFFILIATED COMPANY

The subject is not found to have any subsidiary or affiliated company here in Thailand.

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 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.

BANKING

Bangkok Bank Public Co., Ltd.

Kasikornbank Public Co., Ltd.

EMPLOYMENT

The subject employs approximately 260 office staff and factory workers.

LOCATION DETAILS

The premise is rented for administrative office at the heading address. Premise is located in commercial/residential area.

Factory and warehouse are located at 64/174 Eastern Seaboard Industrial Estate, Moo 4, T. Pluakdaeng, A. Pluakdaeng, Rayong 21140. Tel : [66] 38 926-301.

COMMENT

The company is the world’s leading manufacturer of motion control components and systems supply to various industries. Parker is strategically diversified value-driven and well positioned for global growth as the industrial consolidator and supplier of choice. With its strength in support products to industrial sector has enabled the company to become one of the largest manufactures of industrial related products in the country.

FINANCIAL INFORMATION

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

The capital was increased later as following:

Bht. 21,950,000 on June 13, 1997

Bht. 61,950,000 on February 1, 1999

Bht. 93,950,000 on December 28, 1999

The latest registered capital was increased to Bht. 93,950,000 divided into 93,950 shares of Bht. 1,000 each with fully paid.

THE SHAREHOLDERS LISTED WERE

[as at October 31, 2012]

NAME	HOLDING	%
Parker Hannifin Corporation Nationality: American Address : 17325 Euclid Avenue, Cleveland, Ohio, U.S.A.	93,938	99.99
Parker Hannifin Singapore Pte. Ltd. Nationality: Singaporean Address : 11 Chin Bee Rd., Singapore	10	= 0.01
Parker Hannifin International Corp. Nationality: American Address : 100 Western Street, Wilmington, Newcastle, Delaware, U.S.A.	2

Total Shareholders : 3

Share Structure

[as at October 31, 2012]

Nationality	Shareholders	No. of Share	% Shares
Thai	-	-	-
Foreign	3	93,950	100.00
Total	3	93,950	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO.

Mrs. Nutchalee Bunyakarnkul No. 3126

BALANCE SHEET [BAHT]

The latest financial figures published for June 30, 2012 & 2011 were:

ASSETS

Current Assets	2012	2011
Cash and Cash Equivalents	179,103,836	86,133,977
Trade Accounts & Notes Receivable	214,833,266	249,841,622
Inventories	114,948,314	135,880,634
Other Current Assets	2,238,030	2,290,244
Total Current Assets	511,123,446	474,146,477
Fixed Assets	331,121,121	313,907,748
Other Non-current Assets	2,199,400	2,279,100
Total Assets	844,443,967	790,333,325

LIABILITIES & SHAREHOLDERS' EQUITY [BAHT]

Current Liabilities	2012	2011
Trade Accounts & Other Payable	121,693,773	148,311,879
Accrued Income Tax	12,057,986	19,209,189
Total Current Liabilities	133,751,759	167,521,068
Employee Benefits Obligation	6,326,401	-
Total Liabilities	140,078,160	167,521,068
Shareholders' Equity
Share capital : Baht 1,000 par value authorized, issued and fully paid share capital 93,950 shares	93,950,000	93,950,000
Capital Paid	93,950,000	93,950,000
Retained Earning Appropriated for Statutory Reserve	9,395,000	9,395,000
Unappropriated	601,020,807	519,467,257
Total Shareholders' Equity	704,365,807	622,812,257
Total Liabilities & Shareholders' Equity	844,443,967	790,333,325

PROFIT & LOSS ACCOUNT

Revenue	2012	2011
Sales Income	1,174,062,922	1,082,231,381
Gain on Exchange Rate	3,276,357	6,810,236
Other Income	1,562,569	56,338
Total Revenues	1,178,901,848	1,089,097,955
Expenses
Cost of Goods Sold	791,381,849	717,709,230
Selling Expenses	48,237,483	40,257,904
Administrative Expenses	190,190,558	129,082,914
Total Expenses	1,029,809,890	887,050,048
Profit Before Financial Cost & Income Tax	149,091,958	202,047,907
Financial Cost	[870,840]	[565,851]
Profit Before Income Tax	148,221,118	201,482,056
Income Tax	[33,785,068]	[41,213,503]
Net Profit / [Loss]	114,436,050	160,268,553

FINANCIAL ANALYSIS

ITEM	UNIT	2012	2011
LIQUIDITY RATIO
CURRENT RATIO	TIMES	3.82	2.83
QUICK RATIO	TIMES	2.95	2.01
ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	3.55	3.45
TOTAL ASSETS TURNOVER	TIMES	1.39	1.37
INVENTORY CONVERSION PERIOD	DAYS	53.02	69.10
INVENTORY TURNOVER	TIMES	6.88	5.28
RECEIVABLES CONVERSION PERIOD	DAYS	66.79	84.26
RECEIVABLES TURNOVER	TIMES	5.46	4.33
PAYABLES CONVERSION PERIOD	DAYS	56.13	75.43
CASH CONVERSION CYCLE	DAYS	63.68	77.94
PROFITABILITY RATIO
COST OF GOODS SOLD	%	67.41	66.32
SELLING & ADMINISTRATION	%	20.31	15.65
INTEREST	%	0.07	0.05
GROSS PROFIT MARGIN	%	33.01	34.32
NET PROFIT MARGIN BEFORE EX. ITEM	%	12.70	18.67
NET PROFIT MARGIN	%	9.75	14.81
RETURN ON EQUITY	%	16.25	25.73
RETURN ON ASSET	%	13.55	20.28
EARNING PER SHARE	BAHT	1,218.05	1,705.89
LEVERAGE RATIO
DEBT RATIO	TIMES	0.17	0.21
DEBT TO EQUITY RATIO	TIMES	0.20	0.27
TIME INTEREST EARNED	TIMES	171.20	357.07
ANNUAL GROWTH
SALES GROWTH	%	8.49
OPERATING PROFIT	%	(26.21)
NET PROFIT	%	(28.60)
FIXED ASSETS	%	5.48
TOTAL ASSETS	%	6.85

PROFITABILITY RATIO

Gross Profit Margin	33.01	Impressive	Industrial Average	18.57
Net Profit Margin	9.75	Impressive	Industrial Average	4.91
Return on Assets	13.55	Impressive	Industrial Average	5.35
Return on Equity	16.25	Impressive	Industrial Average	11.23

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 33.01%. 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 9.75%, 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 13.55%, 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 16.25%, 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	3.82	Impressive	Industrial Average	1.03
Quick Ratio	2.95
Cash Conversion Cycle	63.68

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 3.82 times in 2012, increased from 2.83 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 2.95 times in 2012, increased from 2.01 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 64 days.

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

Current Ratio Uptrend

LEVERAGE RATIO

Debt Ratio	0.17	Impressive	Industrial Average	0.51
Debt to Equity Ratio	0.20	Impressive	Industrial Average	0.97
Times Interest Earned	171.20	Impressive	Industrial Average	3.54

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 171.21 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 0.17 less than 0.5, most of the company's assets are financed through equity.

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

Debt Ratio Uptrend

Times Interest Earned Downtrend

ACTIVITY RATIO

Fixed Assets Turnover	3.55	Impressive	Industrial Average	1.47
Total Assets Turnover	1.39	Impressive	Industrial Average	1.04
Inventory Conversion Period	53.02
Inventory Turnover	6.88	Impressive	Industrial Average	5.92
Receivables Conversion Period	66.79
Receivables Turnover	5.46	Satisfactory	Industrial Average	6.52
Payables Conversion Period	56.13

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

Fixed Assets Turnover Uptrend

Total Assets Turnover Uptrend

Inventory Turnover Uptrend

Receivables Turnover Downtrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.55.70
UK Pound	1	Rs.89.34
Euro	1	Rs.72.35

INFORMATION DETAILS

Report Prepared by :

SDA

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.