MIRA INFORM REPORT

Report Date :

26.10.2012

IDENTIFICATION DETAILS

Name :	CHENMING (HK) LTD.
Registered Office :	Flat C, 16/F., Chinaweal Centre, 414-424 Jaffe Road, Wanchai
Country :	Hong Kong
Date of Incorporation :	13.11.2006
Com. Reg. No.:	37349273
Legal Form :	Public and Non-listed
Line of Business :	Paper trader all kinds of paper products, etc.
No. of Employees :	2

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 (31.03.2012)	Current Rating (30.06.2012)
Hong Kong	A2	A2

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

HONG KONG - ECONOMIC OVERVIEW

Hong Kong has a free market economy, highly dependent on international trade and finance - the value of goods and services trade, including the sizable share of re-exports, is about four times GDP. Hong Kong's open economy left it exposed to the global economic slowdown that began in 2008. Although increasing integration with China, through trade, tourism, and financial links, helped it to make an initial recovery more quickly than many observers anticipated, it again faces a possible slowdown as exports to the Euro zone and US slump. The Hong Kong government is promoting the Special Administrative Region (SAR) as the site for Chinese renminbi (RMB) internationalization. Hong Kong residents are allowed to establish RMB-denominated savings accounts; RMB-denominated corporate and Chinese government bonds have been issued in Hong Kong; and RMB trade settlement is allowed. The territory far exceeded the RMB conversion quota set by Beijing for trade settlements in 2010 due to the growth of earnings from exports to the mainland. RMB deposits grew to roughly 7.8% of total system deposits in Hong Kong by the end of 2011, an increase of over 59% since the beginning of the year. The government is pursuing efforts to introduce additional use of RMB in Hong Kong financial markets and is seeking to expand the RMB quota. The mainland has long been Hong Kong's largest trading partner, accounting for about half of Hong Kong's exports by value. Hong Kong's natural resources are limited, and food and raw materials must be imported. As a result of China's easing of travel restrictions, the number of mainland tourists to the territory has surged from 4.5 million in 2001 to 28 million in 2011, outnumbering visitors from all other countries combined. Hong Kong has also established itself as the premier stock market for Chinese firms seeking to list abroad. In 2011 mainland Chinese companies constituted about 43% of the firms listed on the Hong Kong Stock Exchange and accounted for about 56% of the Exchange's market capitalization. During the past decade, as Hong Kong's manufacturing industry moved to the mainland, its service industry has grown rapidly. Growth slowed to 5% in 2011. Credit expansion and tight housing supply conditions caused Hong Kong property prices to rise rapidly in 2010 and inflation to rise 5.3% in 2011. Lower and middle income segments of the population are increasingly unable to afford adequate housing. Hong Kong continues to link its currency closely to the US dollar, maintaining an arrangement established in 1983

Source : CIA

Company name

CHENMING (HK) LTD.

Company ADDRESS

c/o One Nominees Ltd.

Flat C, 16/F., Chinaweal Centre, 414-424 Jaffe Road, Wanchai, Hong Kong.

PHONE: 2535 8828, 2535 7211

FAX: 2513 8466

MANAGEMENT

Managing Director: Mr. Xiao Peng

SUMMARY

Incorporated on: 13th November, 2006.

Organization: Public and Non-listed.

Capital: Nominal: US$100,000.00

Issued: US$100,000.00

Business Category: Paper trader.

Annual Turnover: US$401,591,701.00 (Year ended 31-12-2011)

Employees: 2.

Main Dealing Banker: Bank of China (Hong Kong) Ltd., Hong Kong.

Banking Relation: Satisfactory.

Company name

CHENMING (HK) LTD.

Company ADDRESS

Registered Office:-

c/o One Nominees Ltd.

Flat C, 16/F., Chinaweal Centre, 414-424 Jaffe Road, Wanchai, Hong Kong.

Operating Address:-

Flat F, 27/F., Banyan Mansion, Taikooshing, Hong Kong.

Holding Company:-

Shandong Chenming Paper Holdings Ltd., China.

Associated Companies:-

Chenming International Co. Ltd., China.

Fuyu Chenming Paper Co. Ltd., China.

Hailaer Chenming Paper Co. Ltd., China.

Huanggang Chenming Arboriculture Co. Ltd., China.

Huanggang Chenming Paper Co. Ltd., China.

Jiangxi Chenming Paper Co. Ltd., China.

Jilin Chenming Machinery Manufacturing Co Ltd., China.

Jilin Chenming Paper Co. Ltd., China.

Jilin Chenming Waste Collection Co. Ltd., China.

Juancheng Chenming Panels Co. Ltd., China.

Nanchang Chenming Arboriculture Co. Ltd., China.

Qihe Chenming Panels Co. Ltd., China.

Qihe Chenming Waste Collection Co. Ltd., China.

Shandong Chenming Panels Co. Ltd., China.

Shandong Chenming Paper Group Qihe Paperboard Co. Ltd., China.

Shandong Chenming Paper Sales Co. Ltd., China.

Shandong Chenming Power Supply Holdings Co. Ltd., China.

Shandong Chenming Xinli Power Co. Ltd., China.

Shandong Grand View Hotel Co. Ltd., China.

Shanghai Runchen Equity Investment Fund Co. Ltd., China.

Shougang Meilun Paper Co. Ltd., China.

Shouguang Chenming Art Paper Co. Ltd., China.

Shouguang Chenming Cement Co. Ltd., China.

Shouguang Chenming Floor Board Co. Ltd., China.

Shouguang Chenming Hongxin Packaging Co. Ltd., China.

Shouguang Chenming Import and Export Trade Co. Ltd., China.

Shouguang Chenming Industrial Logistics Co. Ltd., China.

Shouguang Chenming Jiatai Property Management Co. Ltd., China.

Shouguang Chenming Modern Logistic Co. Ltd., China.

Shouguang Chenming Papermaking Machine Co. Ltd., China.

Shouguang Chenming Tianyuan Arboriculture Co. Ltd., China.

Shouguang City Run Sheng Wasted Paper Recycle Co. Ltd., China.

Shouguang Hengfeng Storage Co. Ltd., China.

Shouguang Hongyi Decorative Packaging Co. Ltd., China.

Shouguang Liben Paper Making Co. Ltd., China.

Shouguang Shun Da Customs Declaration Co. Ltd., China.

Shouguang Wei Yuan Logistics Co. Ltd., China.

Shouguang Xinyuan Coal Co. Ltd., China.

Wuhan Chenijan New-style Wall materials Co. Ltd., China.

Wuhan Chenming Hanyang Paper Holdings Co. Ltd., China.

Wuhan Chenming Qianneng Electric Power Co. Ltd., China.

Wuhan Chenming Wan Xing Real Estate Co. Ltd., China.

Wuxie Song Ling Paper Co. Ltd., China.

Yanbian Chenming Paper Co. Ltd., China.

Yangjiang Chenming Arboriculture Co. Ltd., China.

Zhanijang Chenming Paper Pulp Co. Ltd., China.

Zhanjiang Chenming Arboriculture Co. Ltd., China.

etc.

BUSINESS REGISTRATION NUMBER

37349273

COMPANY FILE NUMBER

1087196

MANAGEMENT

Managing Director: Mr. Xiao Peng

CAPITAL

Nominal Share Capital: US$100,000.00 (Divided into 100,000 shares of US$1.00 each)

Issued Share Capital: US$100,000.00

SHAREHOLDER

(As per registry dated 15-06-2012)

Name	No. of shares
Shandong Chenming Paper Holdings Ltd. No. 595 Shengcheng Street, Shouguang City, Shandong Province, China.	100,000 ======

DIRECTORS

(As per registry dated 15-06-2012)

Name (Nationality)	Address
XIAO Peng	Room 601, Unit 1, Block 4, 313 Limin Street, Changle Town, Shandong, China.
LI Feng	No. 402, 2 Danyuan, No. 9 Building, No. 347 Chenming Road, Shouguang City, Shandong Province, China.

SECRETARY

(As per registry dated 15-06-2012)

Name	Address	Co. No.
One Nominees Ltd.	No. C, 16/F., Chinaweal Centre, 414-424 Jaffe Road, Wanchai, Hong Kong.	0359753

HISTORY

The subject was incorporated on 13th November, 2006 as a public and non-listed limited liability company under the Hong Kong Companies Ordinance.

Apart from these, neither material change nor amendment has been ever traced and noted.

OPERATIONS

Activities: Paper trader.

Lines: All kinds of paper products, etc.

Employees: 2.

Commodities Imported: China, etc.

Markets: China, Hong Kong, other Asian countries, Europe, etc.

Annual Turnover: US$284,168,693.00 (Year ended 31-12-2010)

US$401,591,701.00 (Year ended 31-12-2011)

Terms/Sales: CAD or as per contracted.

Terms/Buying: Various terms.

FINANCIAL INFORMATION

Nominal Share Capital: US$100,000.00 (Divided into 100,000 shares of US$1.00 each)

Issued Share Capital: US$100,000.00

Net Assets: US$209,927.00 (Year ended 31-12-2011)

Mortgage or Charge:-

Date of Security Over Deposit: 27-08-2012

Amount: All monies in any currency owing by the Company

Property: A deposit with the charge in the amount of US$20,290,000

under Deposit Account No. 814-041130

Mortgagee: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

Net Profit/(Loss): US$1,741,434.00 (Year ended 31-12-2010)

(US$1,650,414.00) (Year ended 31-12-2011)

Profit or Loss: Made a loss in 2011.

Condition: Keeping in an active manner.

Facilities: Making rather active use of general banking facilities.

Payment: Met trade commitments as required.

Commercial Morality: Satisfactory.

Banker: Bank of China (Hong Kong) Ltd., Hong Kong.

Standing: Normal.

GENERAL

Chenming (HK) Ltd. is a wholly-owned subsidiary of Shandong Chenming Paper Holdings Ltd. [Shandong Chenming] which is a China-based firm.

The subject’s registered office is in a commercial service firm located at “No. C, 16/F., Chinaweal Centre, 414-424 Jaffe Road, Wanchai, Hong Kong” known as “One Nominees Ltd.” which is handling its correspondences and documents. This firm is also the corporate secretary of the subject. The subject’s operating address is located at Flat F, 27/F., Banyan Mansion, Taikooshing, Hong Kong which is in a private building.

Shandong Chenming’s operations are taken place at 595 Shengchen Street, Shougurng City, Shandong Province, China.

The subject is engaged in selling paper products for its holding company. Shandong Chenming purchases materials in the name of the subject and carried out sub-contracting work to turn materials to the finished goods.

Shandong Chenming is a listed firm in China. It’s A and B stock code are 000488 and 200488 respectively. Its A and B shares are traded in Shenzhen Stock Exchange. Shandong Chenming’s H shares are traded in The Stock Exchange of Hong Kong Ltd. bearing stock Code 1812.

For the year ended 31st December, 2011, the turnover of the subject amounted to US$401.6 million (2010: US$284.2 million). The subject suffered from a loss in 2011, it made a loss of US$1.7 million in the year (2010: made a profit of US$1.7 million).

For the year ended 31st December, 2011, the turnover of Shandong Chenming amounted to RMB17,747.5 million (2010: RMB17,203.1 million). Its net profit attributable to shareholders was RMB608.3 million (2010: RMB1,163.3 million).

The subject is fully supported by Shandong Chenming.

On the whole, consider the subject good for normal business engagements.

REMARKS

Brief personal profile of the principal director:-

Mr. Li Feng, who joined Shandong Chenming in 1992, had held different positions including the chief officer of manufacturing section, assistant to the general manager, deputy general manager of Shandong Chenming Paper Group Qihe Paperboard Co., Ltd., deputy general manager, and chairman of Wuhan Chenming Hanyang Paper Holdings Co., Ltd. He is currently the executive Director, deputy general manager of Shandong Chenming and deputy chief marketing officer in charge of the coated paper product sales companies. Mr. Li Feng is the brother of Ms. Li Xueqin, a deputy general manager of Shandong Chenming.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.53.63
UK Pound	1	Rs.86.17
Euro	1	Rs.69.74

INFORMATION DETAILS

Report Prepared by :

PDT

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.