MIRA INFORM REPORT

Report Date :

18.10.2013

IDENTIFICATION DETAILS

Name :	CHOSUN WELDING CO., LTD.

Registered Office :	CHOSUN WELDING ONSAN CO., LTD.

Country :	34-13, Hwasan 2-gil, Onsan-eup, Ulju-gun, Ulsan, Korea

Financials (as on) :	South Korea

Date of Incorporation :	08.01.2010

Com. Reg. No.:	610-86-00965

Legal Form :	Co., Ltd by shares

Line of Business :	Manufacture of Other General- Purpose Machinery n.e.c.

No. of Employees :	118

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory
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 – March, 31^st,2013

Country Name

Previous Rating

(31.12.2012)

Current Rating

(31.03.2013)

South Korea

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

SOUTH KOREA - ECONOMIC OVERVIEW

South Korea over the past four decades has demonstrated incredible growth and global integration to become a high-tech industrialized economy. In the 1960s, GDP per capita was comparable with levels in the poorer countries of Africa and Asia. In 2004, South Korea joined the trillion dollar club of world economies, and is currently the world's 12th largest economy. Initially, a system of close government and business ties, including directed credit and import restrictions, made this success possible. The government promoted the import of raw materials and technology at the expense of consumer goods, and encouraged savings and investment over consumption. The Asian financial crisis of 1997-98 exposed longstanding weaknesses in South Korea's development model including high debt/equity ratios and massive short-term foreign borrowing. GDP plunged by 6.9% in 1998, and then recovered by 9% in 1999-2000. Korea adopted numerous economic reforms following the crisis, including greater openness to foreign investment and imports. Growth moderated to about 4% annually between 2003 and 2007. Korea''s export focused economy was hit hard by the 2008 global economic downturn, but quickly rebounded in subsequent years, reaching 6.3% growth in 2010. The US-South Korea Free Trade Agreement was ratified by both governments in 2011 and went into effect in March 2012. Throughout 2012 the economy experienced sluggish growth because of market slowdowns in the United States, China, and the Eurozone. The incoming administration in 2013, following the December 2012 presidential election, is likely to face the challenges of balancing heavy reliance on exports with developing domestic-oriented sectors, such as services. The South Korean economy''s long term challenges include a rapidly aging population, inflexible labor market, and heavy reliance on exports - which comprise half of GDP.

Source : CIA

Basic Information

Basic

Company Name	CHOSUN WELDING CO., LTD. (Korean Company Name : CHOSUN WELDING ONSAN CO., LTD.,)
Registered Address	321, Hwasan-ri, Onsan-eup, Ulju-gun, Ulsan, Korea (New Address System : 34-13, Hwasan 2-gil, Onsan-eup, Ulju-gun, Ulsan, Korea)
Zip Code	689-896
Tel	+82-52-231-3400
Fax	+82-52-237-3311
E-mail	csadmin@chosunwelding.com
Website	www.chosunwelding.com
Trading Address	90, Dangsandong 4-ga, Yeongdeungpo-gu, Seoul, Korea
Tel	+82-2-3459-9376
Fax	+82-2-553-6116
Type	Export/Import
Industry	Manufacture of Other General- Purpose Machinery n.e.c.
Main Business	Welding Rod, Welding Machines
Established (mm/dd/yyyy)	01/08/2010

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Welders(23171508)
Sell	Welding rods(23171512)
Sell	Welding wire(23171510)

CEO’s

Name	Chang Won-Young
Address	Suite 501, 30, Donggwang-ro 32-gil, Seocho-gu, Seoul, Korea
Date of Birth	08/26/1975
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

3,000,000,000

Employees

118

Formation

Co., Ltd by shares

A Company of DONGKUK INDUSTRIES CO., LTD.(110111-0085583)

Bank Details

Citibank, Korea-Ulsan Sales Dept.

Corporate Registered No.

230111-0161677

Business Registered No.

610-86-00965

Permit & Licenses

Int’l Trade No.: 30663325

Shareholder Position

Name	Shares	%
CS HOLDINGS CO., LTD.(110111-0008486)	600,000	100.00
TOTAL	600,000	100.00

Company History

01/01/2010 Ex. CHOSUN WELDING CO., LTD., has spin off into 3 companies as below;

CS HOLDINGS CO., LTD.(110111-0008486 Existing company),

the subject company, CHOSUN WELDING POHANG CO., LTD.(171711-1186312, Newly established company) which took welding materials business division,

and CHOSUN WELDING ONSAN CO., LTD.(230111-0161677 Newly established company) which took FCW Welding material Business Division

01/08/2010 Incorporated as the present name

Detailed Information

Management

Job Description	Title	Name	Sex	Nationality	Inauguration Date
President & CEO	Mr.	Chang Won-Young	Male	Korean	01/08/2010
Director	Mr.	Cho Sung-Eun	Male	Korean	06/30/2011
Director	Mr.	Chang Joon-Young	Male	Korean	09/09/2010
Auditor	Mr.	Jung Jae-Ho	Male	Korean	03/22/2013

Financials

Year / Unit : KRW	Sales	Assets	Net Income
2012	81,140,552,367	97,225,079,875	1,385,082,540
2011	86,527,250,956	98,685,455,451	4,603,832,892
2010	78,846,202,118	94,473,652,415	3,045,081,056

Financial Description

Authorized Capital(KRW)	10,000,000,000
Paid-Up Capital(KRW)	3,000,000,000
Total Issued Shares	600,000

Balance Sheet
Unit : Korean Won	As of 12/31/2012	As of 12/31/2011	As of 12/31/2010
Total Assets	97,225,079,875	98,685,455,451	94,473,652,415
Current Assets	30,603,015,045	30,696,165,532	27,788,991,553
Cash & Cash Equivalents	8,746,584,904	9,406,536,025	7,122,490,661
Trade Receivables	8,728,012,022	8,713,316,567	10,495,817,841
Other Receivables	739,960,399	1,580,051,891	508,351,978
Other Current Assets	19,627,830	30,975,972	176,931,053
Inventories	12,158,154,364	10,965,285,077	9,485,400,020
Deferred Income Tax Assets	210,675,526	-
Non-Current Assets	66,622,064,830	67,989,289,919	66,684,660,862
Other Receivables	293,203,000	284,342,886	212,383,175
Non-Current Financial Instruments	564,824,000	478,781,000	-
Investment_Subsidiaries	266,078,000	266,078,000	266,078,000
Tangibles	57,425,017,071	58,817,309,088	57,993,584,556
Intangibles	53,978,120	53,978,120	53,978,120
Investment_Real Estates	8,018,964,639	8,088,800,825	8,158,637,011
Total Liabilities	9,955,376,544	12,825,297,946	12,744,153,111
Current Liabilities	9,452,239,320	11,400,440,944	11,604,722,742
Trade Payables	7,543,897,508	8,366,934,877	9,027,029,931
Short-Term Borrowings	-	511,108,884	214,852,232
Other Payables	1,853,398,937	1,643,883,626	1,797,042,981
Other Current Liabilities	54,942,875	175,961,658	391,526,228
Accrued Income Tax	-	702,551,899	174,271,370
Non-Current Liabilities	503,137,224	1,424,857,002	1,139,430,369
Confirmed Salaries	261,605,425	1,045,704,292	744,267,875
Other Payables	204,336,521	196,667,618	194,390,623
Deferred Income Tax Credit	37,195,278	182,485,092	200,771,871
Capital Stock	3,000,000,000	3,000,000,000	3,000,000,000
Capital Surplus	75,862,024,685	75,862,024,685	75,862,024,685
Profit Surplus	8,342,891,400	7,000,459,114	2,867,474,619
Others	64,787,246	-2,326,294	-
Total Equity	87,269,703,331	85,860,157,505	81,729,499,304
Liab. & Shareholder’s Equity	97,225,079,875	98,685,455,451	94,473,652,415

Income Statement
Unit : Korean Won	As of 12/31/2012	As of 12/31/2011	As of 12/31/2010
Sales	81,140,552,367	86,527,250,956	78,846,202,118
Cost of Sold Goods	72,153,282,240	75,719,808,495	68,724,338,513
Gross Profit	8,987,270,127	10,807,442,461	10,121,863,605
Selling & Admin. Expenses	6,271,976,560	5,793,619,825	7,558,915,188
Operating Income	2,715,293,567	5,013,822,636	3,129,817,484
Finance Income	424,298,418	996,355,210	1,010,588,992
Finance Expenses	1,499,864,732	435,229,265	676,835,360
Other Income	84,049,071	181,583,830	774,244,537
Other Expenses	356,685,968	109,655,556	207,375,470
Income Before Taxes	1,367,090,356	5,646,876,855	3,463,571,116
Income Taxes Expenses	-17,992,184	1,043,043,963	418,490,060
Net Income	1,385,082,540	4,603,832,892	3,045,081,056

Cash Flows
Unit : Korean Won	As of 12/31/2012	As of 12/31/2011	As of 12/31/2010
Operating Activities Cash Flows	-149,778,426	5,220,890,619	8,116,975,839
Cash Flows from Operating	824,319,145	5,664,336,750	8,626,019,622
Net Income	1,385,082,540	4,603,832,892	3,045,081,056
Adjustment	2,176,571,091	2,519,263,876	3,269,319,029
Changes in Asset/ & Liability	-2,737,334,486	-1,458,760,018	2,311,619,537
Interests Received	81,770,366	91,672,887	13,524,119
Interests Paid	-8,442,981	-50,912,948	-70,136,142
Income Taxes	-1,047,424,956	-484,206,070	-452,431,760
Cash Flows from Investing	936,189	-2,926,270,842	-2,675,277,470
Cash Flows from Financing	-511,108,884	-10,574,413	211,435,518
Increase/Decrease in Cash	-659,951,121	2,284,045,364	5,653,133,887
Cash at the Beginning of Year	9,406,536,025	7,122,490,661	1,469,356,774
Cash at the End of Year	8,746,584,904	9,406,536,025	7,122,490,661

Products, Technologies, Services Description

Main Products & Services

Welding Rod, Welding Machines

Trade Partners & Competitors

Competitors

KISWEL CO., LTD.

721-3, HAKJANG-DONG, SASANG-GU, BUSAN, KOREA

TEL:+82-51-317-3131~40 FAX:+82-51-325-3627

HYUNDAI WELDING CO., LTD.

16TH FL., ILSONG BLDG., 157-37, SAMSEONG 1-DONG, GANGNAM-GU, SEOUL, KOREA

TEL:+82-2-6230-6010~2 FAX:+82-2-598-6928

CHEGIM WELDING CO., LTD.

42-499, IHYEON-DONG, SEO-GU, DAEGU, KOREA

TEL:+82-53-250-0600 FAX:+82-53-256-8117

Related Parties (Subsidiaries, Joint-Venture & Affiliates)

Affiliates	CS HOLDINGS CO., LTD.(110111-0008486) CHOSUN WELDING POHANG CO., LTD.(171711-1186312) DONGKUK INDUSTRIES CO., LTD.(110111-0085583) DONGKUK R&S CO., LTD.( 195511-0069249) DONGYAN METAL CO., LTD.(KOREA) SEYOUNG SYSTEME CO., LTD.(230111-0130838) DONGKUK S&C(110111-2276784) DAEWON STEEL CO., LTD.(120111-0123711) DONGKUK REFRACTORIES CO., LTD.(195511-0069249) HANRYO ENERGY DEVELOPMENT CO., LTD.(206211-0026796) SHINAN WIND POWER CO., LTD.(201111-0023666) GO DEOK WIND POWER CO., LTD.(161311-0017432) DONGYEON S&T CO., LTD.(110111-3401059) CHUNGSEOK DEVELOPMENT CO., LTD. DK AMERICA, INC. KUMHWA METAL CO., LTD. DK WIND POWER CO., LTD.(234111-0045158) NAMWON WIND POWER CO., LTD.(211311-0005428) DK DONGSHIN CO., LTD.(110111-3850959)
Affiliates-Overseas	CHOSUN VINA CO., LTD. CHOSUN WELDING JAPAN CO., LTD.
Subsidiary	CHOSUN WELDING JAPAN CO., LTD. (100.0% held by the subject company)
Major Shareholders	CS HOLDINGS CO., LTD.(110111-0008486)

Sales by Region (Activity & Markets)

Sales/ Unit :Mil KRW	2012	2011	2010
Export
Domestic
Total

The Subject deals with the companies in Canada, China, Japan, Middle East, South America and South East Asia.

Court Action

Case No.	Court	Plaintiff(s)/ Creditor(s)/ Applicant(s)	Defendant(s)/ Debtor(s)/ Respondent(s)	Cause	Amount (KRW)	Status
		The Subject Company (2 Cases)		-	99,630,000	Proceeding

News Clipping

Not Available

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.58
UK Pound	1	Rs.98.51
Euro	1	Rs.83.49

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%)

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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.