MIRA INFORM REPORT

Report Date :

31.10.2013

IDENTIFICATION DETAILS

Name :	SINOCHEM PLASTICS CO., LTD.

Registered Office :	7/F, Sinochem Tower, No. A2, Fuxingmenwai Street, Beijing, 100045 Pr

Country :	China

Financials (as on) :	31.12.2011

Date of Incorporation :	21.05.1988

Com. Reg. No.:	110000005006960

Legal Form :	One-Person Limited Liability Company

Line of Business :	Subject is engaged in importing and exporting petrochemicals and plastic chemical fiber.

No. of Employees :	125

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 :	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

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

SINOCHEM PLASTICS CO., LTD.

7/f, sinochem tower, no. a2, fuxingmenwai street, beijing, 100045 PR CHINA

TEL: 86 (0) 10-59368993 / 59368585 FAX: 86 (0) 10-59369744

EXECUTIVE SUMMARY

INCORPORATION DATE : may 21, 1988

REGISTRATION NO. : 110000005006960

REGISTERED LEGAL FORM : One-person Limited Liability Company

CHIEF EXECUTIVE : MR. zhang xiaolei (CHAIRMAN)

STAFF STRENGTH : 125

REGISTERED CAPITAL : CNY 200,000,000

BUSINESS LINE : TRADING

TURNOVER : CNY 8,619,700,000 (AS OF DEC. 31, 2011)

EQUITIES : CNY 174,830,000 (AS OF DEC. 31, 2011)

PAYMENT : AVERAGE

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : FAIRly stable (AS OF DEC. 31, 2011)

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : well-known

EXCHANGE RATE : CNY 6.08 = 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

SC is registered as a One-person Limited Liability Company at local Administration for industry & commerce (AIC - the official body of issuing and renewing business license).

Company Status: One-person Limited Liability Company

Single person LLC refers to a limited liability company set up by only one natural person or legal person as the single shareholder of it.

The minimum registered capital of Single person LLC is CNY100,000. The shareholder’s capital contributes, as set out by the articles of associations should be a lump-sum payment in full.

One natural person can only invest in and set up one limited liability company, which is not permitted to invest in and set up a new Single person LLC.

As to any one-person limited liability company, the sole-investor nature of the natural person or legal person shall be indicated in the registration documents of the company and shall be indicated in the business license thereof as well.

The regulation of Single person LLC should be set up by the shareholder

The regulation of Single person LLC has no shareholder meeting.

SC’s registered business scope includes selling liquefied petroleum gas, compressed gas and flammable liquid, oxidant, hydroperoxides, inflammable solid, spontaneous combustible articles and substances emitting flammable gases when wet, corrosive, poisonous articles and rank poison, including: 2-acrylonitrile, methylbenzene-2, 4-diisocyanate, precursor products: methylbenzene, acetone, potassium cyanide, thallium, thallous sulfate, sodium cyanide, methyl ethyl ketone, sulphuric acid, muriatic acid and mineral chameleon. Import and export goods, technology and acting as an agent for it; affecting Chinese foreign equity joint venture enterprise and Chinese foreign contractual joint venture enterprise.

SC is mainly engaged in importing and exporting petrochemicals and plastic chemical fiber.

Mr. Zhang Xiaolei is legal representative and chairman of SC at present.

SC is known to have approx. 125 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office in the commercial zone of Beijing. Our checks reveal that SC owns the total premise, but SC’s accountant refused to release the gross area of the premise.

http://www.sinochemplastics.com/ The design is professional and the content is well organized. At present it is in Chinese and English versions.

Changes of its registered information are as follows:

Date of change	Item	Before the change	After the change
2012	Registered capital	CNY 73,273,600	Present amount

MAIN SHAREHOLDERS:

Name % of Shareholding

Sinochem Co., Ltd. 100

Registration no.: 100000000042135

Legal representative: Liu Deshu 刘德树

Registered capital: CNY 39,800,000,000

Registered address: No. 28, Fuxing Mennei Street, Xicheng District, Beijing

Chairman & Legal representative:

Mr. Zhang Xiaolei, born in 1962 with university education. He is currently responsible for the overall management of SC.

Working Experience(s):

At present Working in SC as chairman and legal representative.

Supervisor:

--------------

Zhao Hongmin

SC is mainly engaged in importing and exporting petrochemicals and plastic chemical fiber.

SC’s products mainly include aromatics, PTA, ethylene glycol, methanol, polyethylene, polypropylene, ABS resin, polyurethane, acrylic acid, and other products.

SC sources its materials 40% from domestic market, and 60% from overseas market, mainly Hong Kong and Singapore. SC sells 90% of its products in domestic market, and 10% to overseas market.

The buying terms of SC include Check, T/T, L/C 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 declined to release its major suppliers and clients.

According to SC’s website:

Sinochem Plastics Co., Ltd. Shanghai Branch

Address: 29/F, Lujiazui Business Plaza, No. 1600 Century Boulevard Pudong New Area, Shanghai

Tel: 021-5081 2631

Fax: 021-5081 6335

Sinochem Plastics Co., Ltd. Shenzhen Branch

Address: Room 2506, Rongchao Economic Trade Center, 4028 Jin Tian Road, Futian Central District, Shenzhen, China

Tel: 0755-8355 1683

Fax: 0755-8355 1982

Sinochem Plastics Co., Ltd. Jiangsu Branch

Address: F19, Jincheng Tower, 216 Longpan Middle Road, Baixia District, Nanjing, China

Tel: 025-5181 7777

Fax: 025-5181 7788

Sinochem Plastics Co., Ltd. Guangzhou Sales Department

Address: Room 2408, East Tower, Yangcheng International Commercial Center No. 122 East Tiyu Road, Tianhe District, Guangzhou, China

Tel: 020-3826 7681

Fax: 020-38267970

Sinochem Plastics Co., Ltd. Chengdu Sales Department

Address: No. 3A04, Unit 1, No. 5 Building, Fengde International Plaza No. 6 Hangkong Road, Wuhou District, Chengdu, China

Tel: 028-8526 6758　　　

Fax: 028-8526 6756

Sinochem Plastics Co., Ltd. Tianjing Sales Department

Address: No. 709 Tianxin Building No. 125 Weidi Road, Hexi District, Tianjin, China

Tel: 022-2840 8320　　　

Fax: 022-2840 8320

Sinochem Plastics Co., Ltd. Qingdao Sales Department

Address: Room 1521, F15, North Building, Golden Plaza No. 20 Xianggang Road, Qingdao, Shandong, China

Tel: 0532-8502 1598　　　

Fax: 0532-8502 1598

Sinochem Plastics Co., Ltd. Zhongshan Sales Department

Address: Room C, 2F, Taiwan Businessman Association Building No. 1, Bo'ai Sixth Road, East District, Zhongshan, Guangdong, China

Tel: 0760-8826 7757

Fax: 0760-8826 2718

Sinochem Trading (Singapore) Pte. Ltd.

Address: Suntec Tower 2,＃18-01/03, 9 Temasek Boulevard, Singapore

Tel: 0065-6338 0110　　　

Fax: 0065-6334 1787

Sinochem Japan Co., Ltd.

Address: IMC Bldg. Shinbashi 6F, 5-5-1 Shimbashi, Minato-ku, Tokyo, Japan

Tel: 0081-3-3434 7890　　　

Fax: 0081-3-3434-8747

Sinochem International Chemicals (Hong Kong) Ltd.

Address: 47F, Office Tower, Convention Plaza, 1 Harbour Road, Wancai, Hong Kong

Tel: 00852-2824 0100　　　

Fax: 00852-2802 9607

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.

Industrial and Commercial Bank of China Beijing Fuwai Sub-branch

AC#：0200048509022101040

Relationship: Normal

Balance Sheet (as of Dec. 31, 2011)

Unit: CNY’000

Cash & bank	416,880
Inventory	749,770
Accounts receivable	610,430
Other receivables	72,820
Other current assets	597,550
	------------------
Current assets	2,447,450
Fixed assets net value	3,430
Projects under construction	0
Long term investment	44,500
Other assets	3,760
	------------------
Total assets	2,499,140
	=============
Short loans	0
Accounts payable	1,908,260
Notes payable	10,000
Other payable	29,390
Taxes payable	8,880
Advances from clients	260,100
Other current liabilities	107,680
	------------------
Current liabilities	2,324,310
Long term liabilities	0
	------------------
Total liabilities	2,324,310
Equities	174,830
	------------------
Total liabilities & equities	2,499,140
	=============

Income Statement (as of Dec. 31, 2011)

Unit: CNY’000

Turnover	8,619,700
Cost of goods sold	8,433,040
Sales expense	113,010
Management expense	66,760
Finance expense	-12,870
Profit before tax	132,000
Less: profit tax	37,920
Profits	94,080

Note: SC’s management declined to release the latest financial information.

Important Ratios

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

	as of Dec. 31, 2011
*Current ratio	1.05
*Quick ratio	0.73
*Liabilities to assets	0.93
*Net profit margin (%)	1.09
*Return on total assets (%)	3.76
*Inventory /Turnover ×365	32 days
*Accounts receivable/Turnover ×365	26 days
*Turnover/Total assets	3.45
* Cost of goods sold/Turnover	0.98

PROFITABILITY: FAIRLY GOOD

The turnover of SC appears good in its line.

SC’s net profit margin is average.

SC’s return on total assets is fairly good.

SC’s cost of goods sold is high, comparing with its turnover.

LIQUIDITY: AVERAGE

The current ratio of SC is maintained in a normal level.

SC’s quick ratio is maintained in a fair level.

The inventory of SC appears average.

The accounts receivable of SC appears average.

SC has no short-term loan in 2011.

SC’s turnover is in a fairly good level, comparing with the size of its total assets.

LEVERAGE: FAIR

The debt ratio of SC is high.

The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly stable.

SC is considered medium-sized in its line with fairly stable financial conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.49
UK Pound	1	Rs.98.71
Euro	1	Rs.84.49

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%)

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.