MIRA INFORM REPORT

Report Date :

18.10.2012

IDENTIFICATION DETAILS

Name :	FIRST ORGANIC FARM CO., LTD.
Registered Office :	24 Soi 7, Prasertmanukit Road, Jorakaebua, Ladprao, Bangkok 10230
Country :	Thailand
Financials (as on) :	31.12.2011
Date of Incorporation :	05.11.2003
Com. Reg. No.:	0245546001117
Legal Form :	Private Limited Company
Line of Business :	Planter, Manufacturer and Distributor of Organic Farm and Organic Products
No. of Employees :	20

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 :	Slow
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

FIRST ORGANIC FARM CO., LTD.

SUMMARY

BUSINESS ADDRESS : 24 SOI 7, PRASERTMANUKIT ROAD, JORAKAEBUA,

LADPRAO, BANGKOK 10230, THAILAND

TELEPHONE : [66] 2940-4591, 2940-3288, 081 488-1888

FAX : [66] 2940-4488, 2570-5595

E-MAIL ADDRESS : ninanoi@hotmail.com

info@dailygreen.net

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 2003

REGISTRATION NO. : 0245546001117

TAX ID NO. : 3031130203

CAPITAL REGISTERED : BHT. 3,000,000

CAPITAL PAID-UP : BHT. 3,000,000

SHAREHOLDER’S PROPORTION : THAI : 100 %

FISCAL YEAR CLOSING DATE : DECEMBER 31

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MS. KOTCHAPHAN TIENRUNGSRI, THAI

MANAGING DIRECTOR

NO. OF STAFF : 20

LINES OF BUSINESS : ORGANIC FARM AND ORGANIC PRODUCTS

PLANTER, MANUFACTURER AND DISTRIBUTOR

CORPORATE PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : FAIR WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH FAIR PERFORMANCE

HISTORY

The subject was established on November 5, 2003 as a private limited company under the registered name FIRST ORGANIC FARM CO., LTD. by Thai groups, with the business objective to operate an organic farm and distribute variety of organic products. It currently employs approximate 20 staff.

The subject’s registered address is 24 Soi 7, Prasertmanukit Rd., Jorakaebua, Ladprao, Bangkok 10240, and this is the subject’s current operation address.

THE BOARD OF DIRECTOR

Name	Nationality	Age
Mr. Virach Tienrungsri	Thai	63
Ms. Methawee [Suvimol] Tienrungsri	Thai	36
Ms. Kotchaphan Tienrungsri	Thai	35

*Ms. Suvimol Tienrungsri changed her name to Ms. Methawee on October 16,

2007.

AUTHORIZED PERSON

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

MANAGEMENT

Ms. Kotchaphan Tienrungsri is the Managing Director.

She is Thai nationality with the age of 35 years old.

Mr. Virach Tienrungsri is the General Manager.

He is Thai nationality with the age of 63 years old.

BUSINESS OPERATIONS

The subject is engaged in farm, plantation and distributing of organic fruits and vegetables, as well as other related organic products, such as organic supplement foods, organic tea and beverages, organic foods, and organic fertilizers, under its brands “DAILYGREEN” and “POOLTO”.

PURCHASE

Agro-seeds for research and development are purchased from suppliers both domestic and overseas, mainly in Japan, India and Republic of China.

SALES

The products are sold to wholesalers and end-users, mainly hotel, restaurant, hospital & clinic, health center and spa business, both local and overseas, such as Korea, Taiwan, Republic of China, Hong Kong, Vietnam and Dubai.

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 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 T/T.

Exports are against T/T.

BANKING

The Siam Commercial Bank Public Co., Ltd.

Bangkok Bank Public Co., Ltd.

EMPLOYMENT

The subject currently employs approximately 20 staff.

LOCATION DETAILS

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

Organic farm is located on 192,000 square meters plot of land at 38 Moo 1, Ngernphan Rd., T. Klong-udomcholakorn, A. Muang, Chachoengsao 24000.

COMMENT

World market for organic food has been growing rapidly in terms of both supply and demand during the past few years. However, development in many different directions in domestic market is quite slow due to the organic products are consumed by high income consumers only because of its higher production cost.

Subject is well organized with variety organic products, but sales remain limit for small consumers group.

FINANCIAL INFORMATION

The capital was registered at Bht. 1,000,000 divided into 10,000 shares of Bht. 100 each with fully paid.

On November 2, 2010, the registered capital was increased to Bht. 3,000,000 divided into 30,000 shares of Bht. 100 each with fully paid.

THE SHAREHOLDERS LISTED WERE : [as at April 30, 2012]

NAME	HOLDING	%
Mr. Virach Tienrungsri Nationality: Thai Address : 24 Soi 7, Prasertmanukit Rd., Jorakaebua, Ladprao, Bangkok	15,000	50.00
Mrs. Chanidapa Tienrungsri Nationality: Thai Address : 24 Soi 7, Prasertmanukit Rd., Jorakaebua, Ladprao, Bangkok	5,000
Ms. Methawee Tienrungsri Nationality: Thai Address : 24 Soi 7, Prasertmanukit Rd., Jorakaebua, Ladprao, Bangkok	5,000	= 50.00
Ms. Kotchaphan Tienrungsri Nationality: Thai Address : 24 Soi 7, Prasertmanukit Rd., Jorakaebua, Ladprao, Bangkok	5,000

Total Shareholders : 4

Share Structure [as at April 30, 2012]

Nationality	Shareholders	No. of Share	% Shares
Thai	4	30,000	100.00
Foreign	-	-	-
Total	4	30,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO. :

Mr. Visith Jirathitiampaiwong No. 1204

BALANCE SHEET [BAHT]

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

ASSETS

Current Assets	2011	2010
Cash and Cash Equivalents	1,261,261.48	955,180.95
Inventories	23,225.00	69,212.00
Total Current Assets	1,284,486.48	1,024,392.95
Fixed Assets	61,756.30	93,885.74
Total Assets	1,346,242.78	1,118,278.69

LIABILITIES & SHAREHOLDERS’ EQUITY [BAHT]

Current Liabilities	2011	2010
Other Current Liabilities	12,967.96	22,683.98
Total Current Liabilities	12,967.96	22,683.98
Total Liabilities	12,967.96	22,683.98
Shareholders' Equity
Share capital : Baht 100 value authorized, issued and fully paid share capital 30,000 shares	3,000,000.00	3,000,000.00
Capital Paid	3,000,000.00	3,000,000.00
Retained Earning - Unappropriated	[1,666,725.18]	[1,904,405.29]
Total Shareholders' Equity	1,333,274.82	1,095,594.71
Total Liabilities & Shareholders' Equity	1,346,242.78	1,118,278.69

PROFIT & LOSS ACCOUNT

Revenue	2011	2010
Sales & Services Income	8,246,672.00	3,436,498.25
Total Revenues	8,246,672.00	3,436,498.25
Expenses
Cost of Goods Sold & Services	4,453,547.00	1,865,242.46
Administrative Expenses	3,539,971.93	1,573,442.59
Total Expenses	7,993,518.93	3,438,685.05
Profit / [Loss] before Income Tax	253,153.07	[2,186.80]
Income Tax	[15,472.96]	[16,171.98]
Net Profit / [Loss]	237,680.11	[18,358.78]
Retained Earning, Beginning of Year	[1,904,405.29]	[1,886,046.51]
Retained Earning, End of Year	[1,666,725.18]	[1,904,405.29]

FINANCIAL ANALYSIS

ITEM	UNIT	2011	2010
LIQUIDITY RATIO
CURRENT RATIO	TIMES	99.05	45.16
QUICK RATIO	TIMES	97.26	42.11
ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	133.54	36.60
TOTAL ASSETS TURNOVER	TIMES	6.13	3.07
INVENTORY CONVERSION PERIOD	DAYS	1.90	13.54
INVENTORY TURNOVER	TIMES	191.76	26.95
RECEIVABLES CONVERSION PERIOD	DAYS	-	-
RECEIVABLES TURNOVER	TIMES	-	-
PAYABLES CONVERSION PERIOD	DAYS	-	-
CASH CONVERSION CYCLE	DAYS	1.90	13.54
PROFITABILITY RATIO
COST OF GOODS SOLD	%	54.00	54.28
SELLING & ADMINISTRATION	%	42.93	45.79
INTEREST	%	-	-
GROSS PROFIT MARGIN	%	46.00	45.72
NET PROFIT MARGIN BEFORE EX. ITEM	%	3.07	(0.06)
NET PROFIT MARGIN	%	2.88	(0.53)
RETURN ON EQUITY	%	17.83	(1.68)
RETURN ON ASSET	%	17.66	(1.64)
EARNING PER SHARE	BAHT	7.92	(0.61)
LEVERAGE RATIO
DEBT RATIO	TIMES	0.01	0.02
DEBT TO EQUITY RATIO	TIMES	0.01	0.02
TIME INTEREST EARNED	TIMES	-	-
ANNUAL GROWTH
SALES GROWTH	%	139.97
OPERATING PROFIT	%	(11,676.42)
NET PROFIT	%	1,394.64
FIXED ASSETS	%	(34.22)
TOTAL ASSETS	%	20.39

PROFITABILITY RATIO

Gross Profit Margin	46.00	Impressive	Industrial Average	6.47
Net Profit Margin	2.88	Impressive	Industrial Average	0.43
Return on Assets	17.66	Impressive	Industrial Average	1.42
Return on Equity	17.83	Impressive	Industrial Average	4.61

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 46%. 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 2.88%, 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 17.66%, 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 17.83%, 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 Uptrend

Return on Equity Uptrend

LIQUIDITY RATIO

Current Ratio	99.05	Impressive	Industrial Average	1.25
Quick Ratio	97.26
Cash Conversion Cycle	1.90

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 99.05 times in 2011, increased from 45.16 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 97.26 times in 2011, increased from 42.11 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 2 days.

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

Current Ratio Downtrend

LEVERAGE RATIO

Debt Ratio	0.01	Impressive	Industrial Average	0.67
Debt to Equity Ratio	0.01	Impressive	Industrial Average	2.08
Times Interest Earned	-		Industrial Average	0.74

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.

Debt Ratio shows the proportion of a company's assets which are financed through debt. The company's figure is 0.01 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 Downtrend

Times Interest Earned Uptrend

ACTIVITY RATIO

Fixed Assets Turnover	133.54	Impressive	Industrial Average	7.17
Total Assets Turnover	6.13	Impressive	Industrial Average	3.36
Inventory Conversion Period	1.90
Inventory Turnover	191.76	Impressive	Industrial Average	6.63
Receivables Conversion Period	-
Receivables Turnover	-		Industrial Average	7.41
Payables Conversion Period	-

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

Fixed Assets Turnover Uptrend

Total Assets Turnover Uptrend

Inventory Turnover Downtrend

Receivables Turnover Uptrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.52.75
UK Pound	1	Rs.85.07
Euro	1	Rs.69.04

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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