MIRA INFORM REPORT

Report Date :

26.04.2014

IDENTIFICATION DETAILS

Name :	COMPANHIA NITRO QUIMICA BRASILEIRA
Registered Office :	AV. DR. Jose Arthur Nova, 951 - São Miguel Paulista 08090-010 - SÃO Paulo/SP
Country :	Brazil
Financials (as on) :	31.12.2013
Date of Incorporation :	20.09.1935
Legal Form :	Privately Held Corporation
Line of Business :	Manufacture of chemical products
No. of Employees	400

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 :	Slow but correct
Litigation :	Exist

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, 2014

Country Name	Previous Rating (31.12.2013)	Current Rating (31.03.2014)
Brazil	A2	A2

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

BRAZIL ECONOMIC OVERVIEW

Characterized by large and well-developed agricultural, mining, manufacturing, and service sectors, Brazil's economy outweighs that of all other South American countries, and Brazil is expanding its presence in world markets. Since 2003, Brazil has steadily improved its macroeconomic stability, building up foreign reserves, and reducing its debt profile by shifting its debt burden toward real denominated and domestically held instruments. In 2008, Brazil became a net external creditor and two ratings agencies awarded investment grade status to its debt. After strong growth in 2007 and 2008, the onset of the global financial crisis hit Brazil in 2008. Brazil experienced two quarters of recession, as global demand for Brazil's commodity-based exports dwindled and external credit dried up. However, Brazil was one of the first emerging markets to begin a recovery. In 2010, consumer and investor confidence revived and GDP growth reached 7.5%, the highest growth rate in the past 25 years. Rising inflation led the authorities to take measures to cool the economy; these actions and the deteriorating international economic situation slowed growth in 2011-13. Unemployment is at historic lows and Brazil's traditionally high level of income inequality has declined for each of the last 14 years. Brazil's historically high interest rates have made it an attractive destination for foreign investors. Large capital inflows over the past several years have contributed to the appreciation of the currency, hurting the competitiveness of Brazilian manufacturing and leading the government to intervene in foreign exchange markets and raise taxes on some foreign capital inflows. President Dilma ROUSSEFF has retained the previous administration's commitment to inflation targeting by the central bank, a floating exchange rate, and fiscal restraint

Source : CIA

Company name and address

COMPANHIA NITRO QUIMICA BRASILEIRA

ADDRESSES

MAIN ADDRESS:	AV. DR. JOSE ARTHUR NOVA, 951 - SÃO MIGUEL PAULISTA
ZIP CODE/CITY:	08090-010 - SÃO PAULO/SP
PHONE:	11 2246-3100
FAX:	11 2246-3100
E-MAIL:	marcio.lima@nitroquimica.com.br
WEB SITE:	www.nitroquimica.com.br

BRANCHES:
ADDRESS:	ESTRADA GERAL, S/N°. - SEGUNDA LINHA TORRENS
ZIP CODE/CITY:	88830-000 MORRO DA FUMÇA/SC
CNPJ:	61.150.348/0042-28
STATE REGISTER:	250896842

LEGAL DATA

MAIN ACTIVITIES:

MANUFACTURE OF CHEMICAL PRODUCTS.

LEGAL FORM:	PRIVATELY HELD CORPORATION
INCORPORATION DATE:	20/09/1935
REGISTER DATE:	20/09/1935
BALANCE SHEET FILING DATE:	31/12
TAX CONTRIBUTOR NUMBER(CNPJ):	61.150.348/0001-50
STATE REGISTER:	100.074.176.113
SHARE CAPITAL:	R$ 193.245.000,00
LAST REGISTER OF CAPITAL:	17/03/2014

BOARD OF DIRECTORS:
GUSTAVO FIGUEIRA DE ALMEIDA E ALBUQUERQUE	GENERAL DIRECTOR
ANDRÉ DAMETO	DIRECTOR

AUTHORIZED USE OF SIGNATURE

THE DIRECTORS ARE AUTHORIZED TO SIGN ON BEHALF OF THE COMPANY.

SHAREHOLDERS / PARTNERS:
FARO CAPITAL FUNDO DE INVESTIMENTO E PARTICIPAÇÕES	99,99%
OTHERS	0,01%

AFFILIATES / SUBSIDIARIES:

NOT AVAILABLE

COMPANY'S BACKGROUND

THE SUBJECT WAS ESTABLISHED ON SEPTEMBER 20, 1935 TO BE ENGAGED IN THE SAID LINE OF BUSINESS AND UP TO DATE IT IS STILL OPERATING WITHIN THE GENERAL SCENE REPORTED HEREIN.

TRADE NAME: NITRO QUÍMICA

ON OCTOBER 14, 2011 THE VOTORANTIM GROUP SOLD COMPANY'S SHARE CONTROL TO THE CURRENT SHAREHOLDERS. THE SUBJECT DOES NOT BELONG TO THE VOTORANTIM GROUP ANYMORE.

ON APRIL 13, 2012 THE COMPANY TOOK OVER HERFOL EMPREENDIMENTOS E PARTICIPAÇÕES S/A (NIRE 35300394267).

FURTHER DETAILS ABOUT THE SUBJECT'S HISTORY ARE SO FAR NOT KNOWN.

PUBLIC INFORMATION:

LAWSUITS:
	DATE:	COURT OF LAW:

1

MUNICIPAL LAWSUIT

21/10/10

1ª VARA DE GUARULHOS/SP

FINANCIAL INFORMATION

GENERAL BALANCE SHEETS AS OF 31/12/2013, 31/12/2012 AND 31/12/2011.

( FIGURES ARE IN THOUSANDS OF REAIS ).

ASSETS
CURRENT:	31/12/2013	31/12/2012	31/12/2011
CASH AND BANKS	113.340	57.489	782
MARKETABLE SECURITIES			1.044
CLIENTS	61.916	56.983	41.255
INVENTORY	39.147	41.939	58.760
RECOVERABLE TAXES	5.681	10.881	7.337
OTHER	5.499	6.937	3.184
	----------------	----------------	----------------
TOTAL CURRENT ASSETS	225.583	174.229	112.362

LONG-TERM RECEIVABLES:
DEFERRED TAXES	29.715	43.263	48.148
OTHER CREDITS	6.204	63.921	34.652
RECOVERABLE TAXES	259	259	190
JUDICIAL DEPOSITS	348	9	2.679
	----------------	----------------	----------------
TOTAL LONG-TERM RECEIVABLES	36.526	107.452	85.669

FIXED ASSETS:
FIXED ASSETS	181.704	207.734	225.286
	----------------	----------------	----------------
TOTAL FIXED ASSETS	181.704	207.734	225.286
	================	================	================
TOTAL ASSETS	443.813	489.415	423.317

LIABILITIES:
CURRENT:	31/12/2013	31/12/2012	31/12/2011
SUPPLIERS	32.659	32.581	38.493
FINANCING	36.461	2.495	993
SALARY, TAXES & CONTRIB.	4.560	9.566	8.901
INCOME TAX/SOCIAL CONTRIBUTION		7.003
TAXES & CONTRIBUTIONS	2.621	1.733	3.741
PROFIT SHARING	6.741
PROVISION FOR HEDGE	10.463
OTHER	9.098	4.545	3.924
	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	102.603	57.923	56.052

LONG TERM LIABILITIES:
LOANS AND FINANCING	36.056	56.160	15.714
PROVISION FOR CONTINGENCIES	44	39	6.122
DEFERRED TAXES		14.317	13.319
OTHER	4.509	60.965	34.140
	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	40.609	131.481	69.295

NET EQUITY:
SHARE CAPITAL	275.238	275.219	275.219
CAPITAL RESERVES	438	440	6.640
PROFIT RESERVES	24.608	16.079	8.803
OTHER COMPREHENSIVE INCOME	317	8.273	7.308
	----------------	----------------	----------------
TOTAL NET EQUITY	300.601	300.011	297.970
	================	================	================
TOTAL LIABILITIES	443.813	489.415	423.317

PROFIT AND LOSS ACCOUNTS AS OF 31/12/2013, 31/12/2012 AND 31/12/2011.

( FIGURES ARE IN THOUSANDS OF REAIS ).

	31/12/2013	31/12/2012	31/12/2011
NET SALES	396.950	354.286	332.140
(-) COST OF SOLD GOODS	255.895	254.547	262.524
	----------------	----------------	----------------
GROSS PROFIT	141.055	99.739	69.616
OPERATING REVENUE (EXPENSE)	-62.836	-42.467	-34.929
FINANCIAL REVENUE(EXPENSE)	-456	-4.059	-3.917
	----------------	----------------	----------------
OPERATIONAL PROFIT (LOSS)	77.763	53.213	30.770
CONTRIBUTION/INCOME TAX	-16.379	-13.034	-272
	----------------	----------------	----------------
NET PROFIT (LOSS)	61.384	40.179	30.498

RATIOS:

31/12/2013

31/12/2012

31/12/2011

QUICK RATIO	1,82		2,28		,96
CURRENT RATIO	2,20		3,01		2,00
ACCOUNTS RECEIVABLE TURNOVER	6,41	TIMES	6,22	TIMES	8,05	TIMES
DAYS' SALES IN RECEIVABLES	56,15	DAYS	57,90	DAYS	44,72	DAYS
INVENTORY TURNOVER	6,54	TIMES	6,07	TIMES	4,47	TIMES
ACCOUNTS PAYABLE PERIOD	45,95	DAYS	46,08	DAYS	52,79	DAYS
RETURN ON ASSETS	,89	TIMES	,72	TIMES	,78	TIMES
SALES TURNOVER ON NET EQUITY	1,32	TIMES	1,18	TIMES	1,11	TIMES
NET WORTH TIE-UP	,60		,69		,76
INDEBTEDNESS	,48		,63		,42
EQUITY RATIO	67,73	%	61,30	%	70,39	%
WORKING CAPITAL RATIO	119,86	%	200,79	%	100,46	%
GENERAL SOLVENCY	3,10		2,58		3,38
RETURN ON NET EQUITY	20,42	%	13,39	%	10,24	%
RETURN ON SALES (PROFIT MARGIN)	15,46	%	11,34	%	9,18	%
GROSS PROFIT MARGIN	35,53	%	28,15	%	20,96	%
OPERATIONAL RESULT	19,59	%	15,02	%	9,26	%
SALES TURNOVER ON LIABILITIES	3,87	TIMES	6,12	TIMES	5,93	TIMES
FOREIGN CURRENCY ON ASSETS
FOREIGN CURRENCY ON LIABILITIES

EXCHANGE RATE:
US$ 1,00 = R$ 2,24	- OFFICIAL RATE ON 16/04/2014
US$ 1,00 = R$ 2,34	- OFFICIAL RATE ON 31/12/2013
US$ 1,00 = R$ 2,04	- OFFICIAL RATE ON 31/12/2012
US$ 1,00 = R$ 1,87	- OFFICIAL RATE ON 31/12/2011

COMMENTS ON THE FINANCIAL INFORMATION:

FOLLOWS ATTACHED WORKSHEET WITH MAIN FINANCIAL RATIOS.

THE FIGURES AVAILABLE SHOW A GOOD FINANCIAL STANDING. IT SHOWS HIGH LIQUIDITY RATIOS AND GOOD WORKING CAPITAL, AS WELL AS LOW LEVEL OF INDEBTEDNESS. IN ADDITION IT IS NOTED HIGH GROWING SALES AND PROFITABILITY.

REAL ESTATE:

OWNED PREMISES ARE VALUED AT R$ 39.149.000,00

VEHICLES:

NOT AVAILABLE

MACHINES:

OWNED MACHINES AND EQUIPMENTS ARE VALUED AT R$ 137.048.000,00

INSURANCE

COVERAGE:	FIRE / EXPLOSION / RAY / MATERIAL DAMAGE
VALUE:	R$ 343.488.000,00
COVERAGE:	THIRD PARTIES’ CIVIL LIABILITY
VALUE:	R$ 10.000.000,00
COVERAGE:	VEHICLES
VALUE:	R$ 1.070.000,00

BANKING REFERENCES

	BRANCH/PHONE:
BANCO BRADESCO S/A	RIO BRANCO / 11 2297-9222
BANCO SANTANDER (BRASIL) S/A	PAULISTA / 11 3012-7066
BANCO ITAU S/A	FARIA LIMA / 11 2998-3408

REMARKS: IN BRAZIL THE BANKS ARE PROHIBITED BY LAW TO PROVIDE INFORMATION OR ANY KIND OF COMMENTS ABOUT THEIR CLIENTS. DUE TO THIS LAW PROHIBITION WE ARE UNABLE TO PROVIDE ANY BANKING DETAILS.

ACCORDING TO THE CENTRAL BANK OF BRAZIL OFFICIAL REPORT, THE COMPANY HAS NO RETURNED CHECKS UP TO DATE. (IN THE TERMS OF "CIRCULAR 1682 BRAZILIAN CENTRAL BANK").

ACTIVITIES COMMENTS

SUBJECT IS ENGAGED IN THE MANUFACTURE OF CHEMICALS, WITH ITS CORE PRODUCTS BEING CELLULOSE NITRATE, FLUORHYDRIC ACID, ALUMINUM FLUORHYDRIC, SULPHURIC ACID, ETC;

IMPORT AND EXPORT:

IMPORTS FROM:

USA, CANADA, GERMANY, ISRAEL AND SOUTH AFRICA.

EXPORTS TO:

CHILE, ARGENTINA, COLOMBIA, COSTA RICA, MEXICO, EL SALVADOR, CANADA, GERMANY, SPAIN, FRANCA, ITALY, AUSTRALIA, MALAYSIA AND TAIWAN.

MAIN CLIENTS:
DOMESTIC CLIENTS:	CITY:	PHONE:
CIA BRASILEIRA DE ALUMÍNIO	SÃO PAULO/SP	31 551-9153
CIA. INDUSTRIAL FLUMINENSE	SÃO JOÃO DEL REI/MG	32 3693-6131
FLINT INK DO BRASIL LTDA		114 3568-6500
MILÊNIA AGRO CIÊNCIAS S/A	TAQUARI/RS	43 371-9000
RENNER SAYERLACK IND. BRAS. S/A	CAJAMAR/SP	11 4447-9040
SUN CHEMICAL DO BRASIL LTDA		11 2462-2534
TUPAHUE TINTAS S/A		11 3568-6500
ULTRAFERTIL S/A IND E COMERCIO FERTILIZANTES		13 3362-0318

STAFF:

THE COMPANY HAS: 400 EMPLOYEE(S)

CONCEPT AND FULFILMENT

THE SUBJECT IS A WELL-ESTABLISHED COMPANY, OPERATING SINCE 1935. SO FAR IT HAS A CLEAR TRADE HISTORY BUT SLOW GOOD PAYMENT BEHAVIOR. BOTH THE COMPANY AND THE PRINCIPALS ENJOY A FAVORABLE REPUTATION AMONG LOCAL TRADE SOURCES.

IT SHOWS A SLOW PAYMENT BEHAVIOR, BUT AS NO RELEVANT DETRIMENTAL FILES ARE REGISTERED, IT MAY BE NOTED THAT THE SUBJECT MEETS ITS TRADE AND FINANCIAL COMMITMENTS PROPERLY.

THE LAWSUIT REPORTED IS NOT RELATED WITH TRADE DEBT. IT IS RELATED TO TAX DEBT THAT FOR ANY REASON THE COMPANY HAS NOT YET PAID. NEVERTHELESS WE POINT OUT THAT THE SAID LAWSUIT DOES NOT AFFECT THE COMPANY'S TRADE REPUTATION.

MAIN SUPPLIERS:
DOMESTIC SUPPLIERS:	CITY:	PHONE:
BUCKEYE AMERICANA LTDA	AMERICANA/SP	19 2108-2207
CARBOCLORO S/A	CUBATÃO/SP	13 361-3511
COMPANHIA BRASILEIRA DE ALUMINIO
FIBRATAM USINA DE TAMBORES DE FIBRA LTDA	SÃO PAULO/SP	11 831-0844
PETROBRAS DISTRIBUIDORA S/A		12 2136-8448
SHELL BRASIL S/A	SÃO PAULO/SP	0800-781515
TIVIT TECNOLOGIA DA INFORMAÇÕES S/A
ULTRAFÉRTIL S/A. IND E COMERCIO DE FERTILIZANTES	CUBATÃO/SP	13 362-0318
VOTORANTIM CIMENTOS BRASIL LTDA
VOTORANTIM COM. DE ENERGIA LTDA

PAYMENT HISTORY:

21 SUPPLIERS REPORTED PAYMENTS:

TOTAL AMOUNT: R$ 1.440.123,00

AMOUNT OF INVOICES PAID: 104

TOTAL OF PROMPT PAYMENTS: 28,9%

TOTAL OF DELAYED PAYMENTS: 71,1%

HIGHEST INVOICE: R$ 82.852,00

HIGHEST CREDIT: R$ 82.852,00

FINAL OPINION

THE SUBJECT IS AN OLD-ESTABLISHED AND RENOWNED COMPANY. DESPITE THE SLOW PAYMENT BEHAVIOR IT SHOWS A CLEAR TRADE HISTORY.

BASED ON THE GENERAL INFORMATION AVAILABLE IT IS BELIEVED THAT GOOD TRADE RELATIONS MAY BE ESTABLISHED. CREDIT FACILITIES MAY BE EXTENDED WITHIN TERMS AND AMOUNTS ADEQUATE TO THE COMPANY'S FINANCIAL STRENGTH

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.12
UK Pound	1	Rs.102.71
Euro	1	Rs.84.52

INFORMATION DETAILS

Analysis Done by :	SUB
Report Prepared by :	NIS

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.