MIRA INFORM REPORT

Report Date :

11.10.2013

IDENTIFICATION DETAILS

Name :	KENAS FURNITURE (SHANGHAI) CO., LTD.
Registered Office :	No. 999, Fengmao Road, Malu Town, Jiading District, Shanghai, 201800 Pr
Country :	China
Date of Incorporation :	10.04.2003
Com. Reg. No.:	310000400338513
Legal Form :	Wholly Foreign-Owned Enterprise
Line of Business :	Subject is engaged in manufacturing and selling furniture.
No. of Employees :	80

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 :	Unknown
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 – March, 31^st, 2013

Country Name	Previous Rating (31.12.2012)	Current Rating (31.03.2013)
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 2012 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 under 8% for 2012. An economic slowdown in Europe contributed to China's, and is expected to further drag Chinese growth in 2013. 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

KENAS FURNITURE (SHANGHAI) CO., LTD.

no. 999, fengmao road, malu town, jiading district, shanghai, 201800 PR CHINA

TEL: 86 (0) 21-39151050/65139316 FAX: 86 (0) 21-39151051

EXECUTIVE SUMMARY

INCORPORATION DATE : apr. 10, 2003

REGISTRATION NO. : 310000400338513

REGISTERED LEGAL FORM : WHOLLY FOREIGN-OWNED ENTERPRISE

CHIEF EXECUTIVE : XU LIHUA (CHAIRMAN)

STAFF STRENGTH : 80

REGISTERED CAPITAL : USD 680,000

BUSINESS LINE : MANUFACTURING and TRADING

TURNOVER : N/A

EQUITIES : N/A

PAYMENT : AVERAGE

MARKET CONDITION : AVERAGE

FINANCIAL CONDITION : N/A

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.1212 = 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

Note: the given tel. no. “086-0574-89070945” belongs to SC’s Ningbo Office.

SC was registered as a wholly foreign-owned enterprise at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on Apr. 10, 2003.

Company Status: Wholly foreign-owned enterprise

This form of business in PR China is defined as a legal person. It is a limited co. established within the territories of PR China with capital provided totally by the foreign investors. More than one foreign investor may jointly invest in a wholly foreign-owned enterprise. The investing party/parties solely exercise management, reap profit and bear risks and liabilities by themselves. This form of companies usually have a limited duration is extendible upon approval of Examination and Approval Authorities.

SC’s registered business scope includes manufacturing furniture, selling self-produced products (with permit if needed).

SC is mainly engaged in manufacturing and selling furniture.

Xu Lihua is legal representative and chairman of SC at present.

SC is known to have approx. 80 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office and factory in Shanghai. SC’s management declined to release detailed information of the premise.

http://www.kenashome.com The website belongs to “Kenas” and it includes the information of SC. The design is professional and the content is well organized. At present it is in English version.

E-mail: accounting@kenashome.com ; info@kenashome.com

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

See below for SC as executive party (defendant).

Executed Party	Kenas Furniture (Shanghai) Co., Ltd.
Court	Shanghai City Jiading District People's Court
Date of Case	Apr. 10, 2008
Case Number	(2008) 00988
Claim Amount	RMB 5,587
Case Status	Processing

Executed Party	Kenas Furniture (Shanghai) Co., Ltd.
Court	Shanghai City Jiading District People's Court
Date of Case	Mar. 27, 2008
Case Number	(2008) 00887
Claim Amount	RMB 7,872
Case Status	Processing

Executed Party	Kenas Furniture (Shanghai) Co., Ltd.
Court	Shanghai City Jiading District People's Court
Date of Case	Mar. 4, 2008
Case Number	(2008) 00707
Claim Amount	RMB 8,045
Case Status	Processing

Executed Party	Kenas Furniture (Shanghai) Co., Ltd.
Court	Shanghai City Jiading District People's Court
Date of Case	Dec. 26, 2007
Case Number	(2008) 00048
Claim Amount	RMB 12,320
Case Status	Completed

Remark: Due to the lack of information, we are unable to provide the cause of action, judgment or other information.

MAIN SHAREHOLDERS:

Name % of Shareholding

Windmill Holdings Company Limited (Hong Kong) 100

Incorporation date: 2002-12-16

Registration no.: 0826016

Legal form: Private

Legal Representative and Chairman:

Xu Lihua is currently responsible for the overall management of SC.

Working Experience(s):

At present Working in SC as chairman and legal representative.

SC is mainly engaged in manufacturing and selling furniture.

Main Products: furniture.

SC sources its materials 100% from domestic market. SC sells 40% of its products in domestic market, and 60% to overseas market.

The buying terms of SC include Check, T/T 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’s management refused to release its main clients and suppliers.

According to the website: http://www.kenashome.com

Li & Fung Limited (Bermuda)

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

Incorporation date: 1992-6-26

Registration no.: F0005502

Legal form: Listed

Web: www.lifung.com

E-mail: ir@lifung.com.hk

The said company is a listed company in Hong Kong Stock Exchange Market with the code of 00494.

Li & Fung Trading Service (Shanghai) Co., Ltd.

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

Incorporation date: 2005-3-17

Registration no.: 310000400417467

Registered capital: USD 6,000,000

Legal rep.: Russell Angus Winyard

Legal form: Wholly foreign-owned enterprise

Ningbo Office:

===========

Tel: 86-574-89070945

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.

SC’s management declined to release the bank information of SC.

SC’s management declined to release any financial information.

SC is considered small-sized in its line with a development history of 10 years. Due to lack of financial status, we are unable to recommend accurate credit limit for SC. Taking into consideration of SC’s operating size as well as market conditions we would rate SC as an above average credit risk company.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.14
UK Pound	1	Rs.99.02
Euro	1	Rs.83.87

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.