MIRA INFORM REPORT

Report Date :

26.09.2012

IDENTIFICATION DETAILS

Name :	VAN AN TRADING COMPANY LIMITED

Registered Office :	No. 112 Linh Nam Street, Mai Dong Ward, Hoang Mai District, Ha Noi City

Country :	Vietnam

Financials (as on) :	31.12.2010

Date of Incorporation :	2000

Com. Reg. No.:	0101018067

Legal Form :	Limited Liability Company

Line of Business :	trading nutritious food and products for mothers and baby

No. of Employees :	400 employees

RATING & COMMENTS

MIRA’s Rating :

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

Status :	Moderate
Payment Behaviour :	Slow but Correct
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)

Vietnam

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

vietnam - ECONOMIC OVERVIEW

Vietnam is a densely-populated developing country that in the last 30 years has had to recover from the ravages of war, the loss of financial support from the old Soviet Bloc, and the rigidities of a centrally-planned economy. While Vietnam's economy remains dominated by state-owned enterprises, which still produce about 40% of GDP, Vietnamese authorities have reaffirmed their commitment to economic liberalization and international integration. They have moved to implement the structural reforms needed to modernize the economy and to produce more competitive export-driven industries. Vietnam joined the World Trade Organization in January 2007 following more than a decade-long negotiation process. Vietnam became an official negotiating partner in the developing Trans-Pacific Partnership trade agreement in 2010. Agriculture's share of economic output has continued to shrink from about 25% in 2000 to about 22% in 2011, while industry's share increased from 36% to 40% in the same period. Deep poverty has declined significantly, and Vietnam is working to create jobs to meet the challenge of a labor force that is growing by more than one million people every year. The global recession has hurt Vietnam's export-oriented economy, with GDP in 2009-11 growing less than the 7% per annum average achieved during the last decade. In 2011, exports increased by more than 33%, year-on-year, and the trade deficit, while reduced from 2010, remained high, prompting the government to maintain administrative trade measures to limit the trade deficit. Vietnam's managed currency, the dong, continues to face downward pressure due to a persistent trade imbalance. Since 2008, the government devalued it in excess of 20% through a series of small devaluations. Foreign donors pledged nearly $8 billion in new development assistance for 2011. However, the government's strong growth-oriented economic policies have caused it to struggle to control one of the region's highest inflation rates, which reached as high as 23% in August 2011 and averaged 18% for the year. In February 2011, Vietnam shifted its focus away from economic growth to stabilizing its economy and tightened fiscal and monetary policies. In early 2012 Vietnam unveiled a broad "three pillar" economic reform program, proposing the restructuring of public investment, state-owned enterprises and the banking sector. Vietnam's economy continues to face challenges from low foreign exchange reserves, an undercapitalized banking sector, and high borrowing costs. The near-bankruptcy and subsequent default of the state-owned-enterprise Vinashin, a leading shipbuilder, led to a ratings downgrade of Vietnam's sovereign debt, exacerbating Vietnam's borrowing difficulties.

Source : CIA

SUBJECT IDENTIFICATION & LEGAL FORM

Current legal status
English Name		VAN AN TRADING COMPANY LIMITED
Vietnamese Name		CONG TY TNHH THUONG MAI VAN AN
Short name		VA CO.,LTD
Type of Business		Limited liability company
Year Established		2000
Business Registration No.		0101018067
Date of Registration		06 Dec 2011
Place of Registration		Planning and investment department of Hanoi City
Chartered capital		VND 25,000,000,000
Status		Unlisted
Tax code		0101018067
Total Employees		400
Size		Medium

Historical Identification & Legal form

List

Changed Items

Date of changes

Subject has got former Chartered capital: VND 19,000,000,000 Changed to: VND 25,000,000,000

2012

Subject has got former Business Registration No: 0102000508

Changed to: 0101018067

06 Dec 2011

company ADDRESSES

Head Office
Address		Lot B2, Road 4, Sai Dong B Industrial Park , Long Bien District, Ha Noi City, Vietnam
Telephone		(84-4) 38626345/ 36330439
Fax		(84-4) 36331555
Email		vanantrading@hn.vnn.vn
Website		www.vanan.vn

Registration Address
Address		No. 112 Linh Nam Street, Mai Dong Ward, Hoang Mai District, Ha Noi City, Vietnam

Branch in Ho Chi Minh
Address		No. 168D D2 Street, Van Thanh Bac Group, Ward 25, Binh Thanh District, Ho Chi Minh City, Vietnam
Telephone		(84-8) 62580262
Fax		(84-8) 62580263

DIRECTORS

1. NAME		Mr. DUONG TIEN VIET
Position		Director
Date of Birth		19 Oct 1971
ID Number/Passport		011494411
ID Issue Date		20 Jun 1997
ID Issue Place		Hanoi police-station
Resident		Tan Khai Hamlet Vinh Hung Ward, Hoang Mai District, Ha Noi City, Vietnam
Nationality		Vietnamese
Tel/Mobile phone		(84-4) 38626345

2. NAME		Mr. DUONG VIET TUAN
Position		Deputy Director
ID Number/Passport		012041282
Resident		Tan Khai Hamlet Vinh Hung Ward, Hoang Mai District, Ha Noi City, Vietnam
Nationality		Vietnamese

BUSINESS NATURE AND ACTIVITIES

The subject is specialized in trading nutritious food and products for mothers and baby. The subject is sole distributor for Hipp's products in Vietnam.

IMPORT & EXPORT ACTIVITIES

IMPORT:
· Market		America, Germany, Taiwan, Chile, Spain, Austria...
· Mode of payment		L/C, T/T

EXPORT:
Note: Currently, the subject does not export

BANKERS

1. VIETNAM TECHNOLOGICAL AND COMMERCIAL JOINT STOCK BANK
Address		No.70-72 Ba Trieu, Hoan Kiem District, Ha Noi City, Vietnam
Telephone		(84-4) 3944 6368
Fax		(84-4) 3944 6362
VND Account		10810816014018

SHAREHOLDERS

1. NAME		Mr. DUONG TIEN VIET
Position		Director
Date of Birth		19 Oct 1971
ID Number/Passport		011494411
Issued on		20 Jun 1997
Issued Place		Hanoi police-station
Resident		Tan Khai Hamlet Vinh Hung Ward, Hoang Mai District, Ha Noi City, Vietnam
Work phone		(84-4) 38626345
Nationality		Vietnamese
Value of shares		VND 13,750,000,000
Percentage		55%

2. NAME		Mr. DUONG VIET TUAN
Position		Deputy Director
ID Number/Passport		012041282
Resident		Tan Khai Hamlet Vinh Hung Ward, Hoang Mai District, Ha Noi City, Vietnam
Nationality		Vietnamese
Value of shares		VND 11,250,000,000
Percentage		45%

FINANCIAL DATA

BALANCE SHEET
Unit: Million VND
Balance sheet date	31/12/2010
Number of weeks	52
ASSETS
A – CURRENT ASSETS	94,425
I. Cash and cash equivalents	3,221
1. Cash
2. Cash equivalents
II. Short-term investments
1. Short-term investments
2. Provisions for devaluation of short-term investments
III. Accounts receivable	26,089
1. Receivable from customers	18,833
2. Prepayments to suppliers	407
3. Inter-company receivable
4. Receivable according to the progress of construction
5. Other receivable	6,849
6. Provisions for bad debts
IV. Inventories	62,458
1. Inventories	62,458
2. Provisions for devaluation of inventories
V. Other Current Assets	2,657
1. Short-term prepaid expenses
2. VAT to be deducted	2,654
3. Taxes and other accounts receivable from the State
4. Other current assets	3
B. LONG-TERM ASSETS	2,642
I. Long term accounts receivable
1. Long term account receivable from customers
2. Working capital in affiliates
3. Long-term inter-company receivable
4. Other long-term receivable
5. Provisions for bad debts from customers
II. Fixed assets	2,515
1. Tangible assets	2,515
- Historical costs	3,586
- Accumulated depreciation	-1,071
2. Financial leasehold assets
- Historical costs
- Accumulated depreciation
3. Intangible assets
- Initial costs
- Accumulated amortization
4. Construction-in-progress
III. Investment property
Historical costs
Accumulated depreciation
IV. Long-term investments
1. Investments in affiliates
2. Investments in business concerns and joint ventures
3. Other long-term investments
4. Provisions for devaluation of long-term investments
V. Other long-term assets	127
1. Long-term prepaid expenses
2. Deferred income tax assets
3. Other long-term assets	127
VI. Goodwill
1. Goodwill
TOTAL ASSETS	97,067

LIABILITIES
A- LIABILITIES	78,169
I. Current liabilities	78,169
1. Short-term debts and loans	39,559
2. Payable to suppliers	37,408
3. Advances from customers	372
4. Taxes and other obligations to the State Budget	786
5. Payable to employees
6. Accrued expenses
7. Inter-company payable
8. Payable according to the progress of construction contracts
9. Other payable	44
10. Provisions for short-term accounts payable
11. Bonus and welfare funds
II. Long-Term Liabilities
1. Long-term accounts payable to suppliers
2. Long-term inter-company payable
3. Other long-term payable
4. Long-term debts and loans
5. Deferred income tax payable
6. Provisions for unemployment allowances
7. Provisions for long-term accounts payable
8. Unearned Revenue
9. Science and technology development fund
B- OWNER’S EQUITY	18,898
I. OWNER’S EQUITY	18,898
1. Capital	19,060
2. Share premiums
3. Other sources of capital
4. Treasury stocks
5. Differences on asset revaluation
6. Foreign exchange differences
7. Business promotion fund
8. Financial reserved fund
9. Other funds
10. Retained earnings	-162
11. Construction investment fund
12. Business arrangement supporting fund
II. Other sources and funds
1. Bonus and welfare funds (Elder form)
2. Sources of expenditure
3. Fund to form fixed assets
MINORITY’S INTEREST
TOTAL LIABILITIES AND OWNER’S EQUITY	97,067

PROFIT & LOSS STATEMENT

Description	FY2010
1. Total Sales	200,159
2. Deduction item	223
3. Net revenue	199,936
4. Costs of goods sold	166,109
5. Gross profit	33,827
6. Financial income	2,666
7. Financial expenses	17,498
- In which: Loan interest expenses	3,113
8. Selling expenses
9. Administrative overheads	19,257
10. Net operating profit	-262
11. Other income	566
12. Other expenses	5
13. Other profit /(loss)	561
14. Total accounting profit before tax	299
15. Current corporate income tax	75
16. Deferred corporate income tax
17. Interest from subsidiaries/related companies
18. Profit after tax	224

FINANCIAL RATIOS AND AVERAGE INDUSTRY RATIOS

Description	FY2010	Average Industry
Current liquidity ratio	1.21	1.29
Quick liquidity ratio	0.41	0.90
Inventory circle	2.66	16.60
Average receive period	47.63	61.82
Utilizing asset performance	2.06	2.31
Liability by total assets	80.53	66.08
Liability by owner's equity	413.64	252.07
Ebit / Total assets (ROA)	3.52	6.85
Ebit / Owner's equity (ROE)	18.05	25.35
Ebit / Total revenue (NPM)	1.70	4.35
Gross profit / Total revenue (GPM)	16.90	8.03
Note: The Average Industry was calculated by VietnamCredit based on our own statistical data

PAYMENT HISTORY & PERFORMANCE EXPERIENCES

Trade Morality		Fair
Liquidity		Medium
Payment status		Average
Financial Situation		Average
Development trend		Positive
Litigation data		No Record
Bankruptcy		No Record
Payment Methods		L/C, T/T
Sale Methods		Retailer and Wholesaler

INTERPRETATION ON THE SCORES

VAN AN TRADING COMPANY LIMITED was established in 2000, as a liability limited company. Currently, the subject is operating under business registration no. 0101018067 and chartered capital of VND 25 billion

Head office of the subject is locating at Lot B2, Road 4, Sai Dong B Industrial Park, Long Bien District, Ha Noi City, Vietnam. Besides, it has a branch in Ho Chi Minh City and a nationwide distribution network. The number of employees of the subject is about 400 people. The subject specializes in processing and trading nutrient foods and consumer products for mothers and babies of well-known brands as HiPP, Nutra Omega 3, Dintel, Bebivita, Farlin. Its products are divided into many types as nutritious foods, milk, juices, drinks and other products for mothers and baby. The subject’s products are rather popular with consumer, and relative famous in domestic market.

The subject has been operating in the industry for over ten years. But the subject now has to face with competition of big companies in this field such as: Vinamilk, Dutch Lady, Moc Chau, IDP, TH True milk.

According to financial data, its business results in 2010 seemed worse than 2009. Its total assets and revenue were decreased; the cause is from the general difficulties from economy crisis. In addition, because of very higher administrative overheads expenses, its profit slumped. Even, the net operating profit was negative; the subject had to rely on other profit to cover the loss from business activities. The current liquidity was acceptable. However, the inventories accounted a big rate in current assets, so it led quick liquidity ratio was rather low in compared with average industry in both of years 2010 and 2009. In addition, the leverage ratio shows the high dependent on debt of the subject.

To sum up, the subject is a medium company in the field; the management capability of the subject is fair. In the future, the business activity is expected brighter. It is able to meet medium commitment.

APPENDIX

INDUSTRY DATA

Industry code	Growth speed by price compared with 1994 (%)		Total enterprises 2009		Total employees 2010 (Thous.pers.)	Annual average capital of enterprises 2009 (billion dongs)
	2011	2010
Agriculture, Forestry and Fishing	4.00	2.78	8,749		23,896.3	81,559
Industry and Construction	5.53	7.70	85,115		10,630	2,751,975
Trade and Services	6.69	7.52	154,978		14,522	4,939,069

ECONOMIC INDICATORS

			2011	2010		2009
Population (Million person)			87.84	86.93		86.02
Gross Domestic Products (USD billion)			119	102.2		91
GDP Growth (%)			5.89	6.78		5.32
GDP Per Capita (USD/person/year)			1,300	1,160		1,080
Inflation (% Change in Composite CPI)			18.58	11.75		6.88
State Budget Deficit compared with GDP (%)			4.9	5.8		6.9

SERVICE TRADE PERFORMANCE

Billion USD			2011	2010		2009
Exports			96.3	72.2		57.1
Imports			105.8	84.8		69.9
Trade Balance			-9.5	-12.6		-12.8

Source: General Statistics Office

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.53.53
UK Pound	1	Rs.86.82
Euro	1	Rs.69.03

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%)

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