MIRA INFORM REPORT

Report Date :

08.08.2014

IDENTIFICATION DETAILS

Name :	Farmasino Pharmaceuticals (Jiangsu) Co., Ltd.
Registered Office :	9/F, Building F6, No. 9 Weidi Road, Qixia District, Nanjing, Jiangsu Province, 210004 PR
Country :	China
Financials (as on) :	31.12.2013
Date of Incorporation :	17.10.2008
Com. Reg. No.:	320000000076867
Legal Form :	Limited Liabilities Company
Line of Business :	Engaged in trading of pharmaceuticals, chemicals.
No. of Employees :	130

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 :	No complaints
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 01, 2014

Country Name	Previous Rating (31.03.2014)	Current Rating (01.06.2014)
China	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

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, growth of the private sector, development of stock markets and a modern banking system, 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 considered important to "economic security," explicitly looking to foster globally competitive industries. After keeping its currency tightly linked to the US dollar for years, in July 2005 China 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 and expanded the daily trading band within which the RMB is permitted to fluctuate. 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 2013 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 consumption; (b) facilitating higher-wage job opportunities for the aspiring middle class, including rural migrants and increasing numbers of college graduates; (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. Several factors are converging to slow China's growth, including debt overhang from its credit-fueled stimulus program, industrial overcapacity, inefficient allocation of capital by state-owned banks, and the slow recovery of China's trading partners. The government's 12th Five-Year Plan, adopted in March 2011 and reiterated at the Communist Party's "Third Plenum" meeting in November 2013, emphasizes continued economic reforms and the need to increase domestic consumption in order to make the economy less dependent in the future on fixed investments, exports, and heavy industry. However, China has made only marginal progress toward these rebalancing goals. The new government of President XI Jinping has signaled a greater willingness to undertake reforms that focus on China's long-term economic health, including giving the market a more decisive role in allocating resources

Source : CIA

Company name and address

Farmasino Pharmaceuticals (Jiangsu) Co., Ltd.

9/F, BUILDING F6, NO. 9 WEIDI ROAD, QIXIA DISTRICT, NANJING,

JIANGSU PROVINCE, 210004 PR CHINA

TEL: 86 (0) 25-84267953/86907282 FAX: 86 (0) 25-86907366

EXECUTIVE SUMMARY

INCORPORATION DATE : OCTOBER 17, 2008

REGISTRATION NO. : 320000000076867

REGISTERED LEGAL FORM : LIMITED LIABILITIES COMPANY

CHIEF EXECUTIVE : MR. WAN HUIZHONG (CHAIRMAN)

STAFF STRENGTH : 130

REGISTERED CAPITAL : CNY 30,000,000

BUSINESS LINE : TRADING

TURNOVER : CNY 541,940,000 (AS OF DEC. 31, 2013)

EQUITIES : CNY 50,700,000 (AS OF DEC. 31, 2013)

PAYMENT : AVERAGE

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : FAIRLY STABLE

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.1589= 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 (No. 100, Jianye Road, Nanjing 210004 China) is SC’s another operating address, and the heading one is SC’s main operating address.

SC was registered as a limited liabilities company at provincial Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on October 17, 2008.

Company Status: Limited liabilities co.

This form of business in PR China is defined as a legal person. No more than fifty shareholders contribute its registered capital jointly. Shareholders bear limited liability to the extent of shareholding, and the co. is liable for its debts only to extent of its total assets. The characteristics of this form of co. are as follows:

Upon the establishment of the co., an investment certificate is issued to the each of shareholders.

The board of directors is comprised of three to thirteen members.

The minimum registered capital for a co. is CNY 30,000.

Shareholders may take their capital contributions in cash or by means of tangible assets or intangible assets such as industrial property and non-patented technology.

Cash contributed by all shareholders must account for at least 30% of the registered capital.

Existing shareholders have pre-exemption right to purchase shares of the co. offered for sale by the other shareholders and to subscribe for the newly increased registered capital of the co.

SC’s registered business scope includes permitted operation items: operating hazardous chemicals, non-medicine precursor chemicals, II & III class medical apparatus and instruments. General operation items: developing, researching and transferring chemical technology and information consultant and services; importing and exporting commodities and technology; selling chemical products; and domestic trade.

SC is mainly engaged in trading of pharmaceuticals, chemicals, etc.

Mr. Wan Huizhong is legal representative and chairman of SC at present.

SC is known to have approx. 130 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office in the commercial zone of Nanjing. Our checks reveal that SC owns the total premise, but the gross area is unspecified.

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

Email: info@famasino.com

Changes of its registered information:

Date of change	Item	Before the change	After the change
Unknown	Legal representative	Fan Zhongfeng	Present one
	Shareholder’s name	Jiangsu Light Industrial Products Import & Export (Group) Corporation	High Hope Zhongding Corporation
	Registered capital	CNY 10,000,000	Present amount
	% of shareholding	High Hope Zhongding Corporation Tong Xiao 5% Wang Li 30% Yan Libo 30%	Present one

Subject passed the annual inspection of 2012 with Administration for Industry & Commerce.

Organization Code: 681149459

For the past two years there is no record of litigation.

MAIN SHAREHOLDERS:

Name Amount (CNY) % of Shareholding

High Hope Zhongding Corporation 12,000,000 40

Tong Xiao 1,500,000 5

ID # 32010619690125xxxx

Wang Li 7,314,400 24.38

ID # 32092319771107xxxx

Yan Libo 9,185,600 30.62

ID # 43242619760919xxxx

High Hope Zhongding Corporation

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

High Hope Zhongding Corporation (formerly “Jiangsu Light Industrial Products Import & Export (Group) Corporation”) is one of the earliest foreign trade companies since the opening of Jiangsu port. Today the company has become a large-scale state enterprise with foreign trade as its leading work and a combination of real estate and investment business. Its registered capital is 278 million 592 thousand and 6 hundred Yuan. By the end of 2013, its net assets had exceeded 1 billion Yuan with annual business volume about 10 billion Yuan. The company mainly engages in export of light industrial products, textiles, machinery, ships, pharmaceuticals, chemicals, import and domestic trade of chemical materials, machinery and equipments. With an annual import and export volume over 1.2 billion USD, its business has spread over 100 countries and regions. For many years, it has ranked among the first hundred of five hundred enterprises holding the largest import and export amount in China. The brands of “FRIENDLY” and “JSLTOYS” have been recognized by the state as specially supported key brands for export and “Panda”, “Tiger”, “Swallow” as Jiangsu provincial famous brands.

Registered No.: 320000000000640

Incorporation Date: October 15, 1981

Registered Legal Form: Shares Limited Co.

Legal representative: Wan Huizhong

Tel: 86-25-58006166

Fax: 86-25-84208398

Email: jsl@jslgroup.com

Web: http://www.jslgroup.com/

l Legal representative and chairman:

Mr. Wan Huizhong, ID # 32011419640807xxxx, born in 1964. He is currently responsible for the overall management of SC.

Working Experience(s):

At present Working in SC as chairman and legal representative.

Also working in High Hope Zhongding Corporation, Jiangsu Kaiyuan International Machinery Co., Ltd., Jiangsu Kaiyuan Tourism Co., Ltd., Jiangsu Kaiyuan International Tianpu Tools Co., Ltd., Jiangsu Zhongxin Toys Co., Ltd., Nanjing Kaiyuan Kangda Trading Co., Ltd., etc. as legal representative

l General manager and Director:

Mr. Yan Libo, ID # 43242619760919xxxx, born in 1976. He is currently responsible for the daily management of SC.

Working Experience(s):

From 2008 to present Working in SC as general manager and director.

Also working in FarmaSino Pharmaceuticals (Anhui) Co., Ltd. as legal representative

l Directors:

Fan Zhongfeng, ID#32011419730331xxxx, born in 1973

Wang Li, ID#32092319771107xxxx, born in 1977

Tong Xiao, ID#32010619690125xxxx, born in 1969

l Supervisor:

Pan Shijie, ID#32010219650602xxxx, born in 1965

SC is mainly engaged in trading of pharmaceuticals, chemicals.

Main Products:

Finished Drugs (Tablets, Capsules, Liquid Injections, Powder for Injections, Miscellaneous, Packing Materials, Surgicals, Animal Medicine)

Bulk Pharmaceuticals (Active Pharmaceutical Ingredients, Veterinary Products, Amino Acids, Vitamins, Plant Extracts, Nutritional Supplements, Food Additives)

Intermediates & Chemicals (Pharmaceutical Intermediates, Agrochemical Intermediates, Pigment Intermediates, Fine Chemicals, Petrochemicals, Customer Manufacturing)

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

Trademark & Patents

Registration No.	10964746	7639171	7639170
Registration Date	2013-9-14	2010-11-21	2011-2-28
Trademark Design

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 declined to release its major clients and suppliers.

Jiangsu Kaiyuan International Machinery Co., Ltd. (literal translation)

Jiangsu Kaiyuan Tourism Co., Ltd. (literal translation)

Jiangsu Kaiyuan International Tianpu Tools Co., Ltd.

Jiangsu Zhongxin Toys Co., Ltd.

Nanjing Kaiyuan Kangda Trading Co., Ltd.

Subsidiary

FarmaSino Pharmaceuticals (Anhui) Co., Ltd.

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

Reg. No.: 341424000008410

Incorporation date: 2008-10-15

Legal representative: Yan Libo

http://www.farmasino.com.cn/

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.

Bank of China Jiangsu Branch

AC#：509258191251

Relationship: Normal.

Balance Sheet

Unit: CNY’000

	As of Dec. 31, 2013	As of Dec. 31, 2012
Cash & bank	87,560	85,440
Inventory	14,590	10,110
Accounts receivable	83,350	54,380
Advances to suppliers	31,500	26,780
Other current assets	14,010	9,650
Other receivables	18,460	410
	------------------	------------------
Current assets	249,470	186,770
Fixed assets net value	17,110	1,230
Long term investment	8,040	0
Projects under construction	0	0
Long-term prepaid expenses	1,190	0
Intangible assets	0	0
Deferred assets	100	90
	------------------	------------------
Total assets	275,910	188,090
	=============	=============
Short loans	35,000	48,000
Notes payable	130,260	76,640
Accounts payable	38,400	33,760
Advances from clients	22,430	5,400
Accrued payroll	0	0
Taxes payable	-1,090	-410
Other accounts payable	210	130
	------------------	------------------
Current liabilities	225,210	163,520
Long term liabilities	0	0
	------------------	------------------
Total liabilities	225,210	163,520
Equities	50,700	24,570
	------------------	------------------
Total liabilities & equities	275,910	188,090
	=============	=============

Income Statement

Unit: CNY’000

	As of Dec. 31, 2013	As of Dec. 31, 2012
Turnover	541,940	500,280
Cost of goods sold	510,790	472,190
Sales expense	21,580	18,970
Management expense	3,690	2,020
Finance expense	-2,610	650
Assets impairment loss	60	10
Non-operating income	170	70
Non-operating expense	370	320
Profit before tax	8,230	6,190
Less: profit tax	2,100	1,670
Profits	6,130	4,520

Important Ratios

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

	As of Dec. 31, 2013	As of Dec. 31, 2012
*Current ratio	1.11	1.14
*Quick ratio	1.04	1.08
*Liabilities to assets	0.82	0.87
*Net profit margin (%)	1.13	0.90
*Return on total assets (%)	2.22	2.40
*Inventory /Turnover ×365	10 days	7 days
*Accounts receivable/Turnover ×365	56 days	40 days
*Turnover/Total assets	1.96	2.66
* Cost of goods sold/Turnover	0.94	0.94

PROFITABILITY: AVERAGE

l The turnover of SC appears fairly good in its line and increased in 2013.

l SC’s net profit margin is average in both years.

l SC’s return on total assets is average in both years.

l SC’s cost of goods sold is fairly high in both years, comparing with its turnover.

LIQUIDITY: AVERAGE

l The current ratio of SC is normal in both years.

l SC’s quick ratio is normal in both years.

l SC’s inventory is average in both years.

l SC’s account receivable is average in both years.

l SC’s short loan is large in both years.

l SC’s turnover is in an average level, comparing with the size of its total assets.

LEVERAGE: FAIR

l The debt ratio of SC is high in 2012, and fairly high in 2013.

l The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly stable

SC is considered large-sized in its line with fairly stable financial conditions. The large amount of short loan could be a threat to SC’s financial conditions. Taking into consideration of SC’s general performance and operation size, we would rate SC as an average credit risk company.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.41
UK Pound	1	Rs.103.42
Euro	1	Rs.82.16

INFORMATION DETAILS

Analysis Done by :	KAR
Report Prepared by :	PDT

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.