MIRA INFORM REPORT

Report Date :

09.08.2014

IDENTIFICATION DETAILS

Name :	KUMKANG KIND CO., LTD.

Registered Office :	110, Dasan-ro, Saha-gu, Busan, Korea 604-826

Country :	South Korea

Financials (as on) :	31.03.2014

Date of Incorporation :	08.08.1979

Com. Reg. No.:	603-81-15882

Legal Form :	Listed Company

Line of Business :	Manufacture of Pipes and Tubes, of Non-cast Iron or Steel

No. of Employees	422

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 :	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 1, 2014

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

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. South 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. South 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-Korea Free Trade Agreement was ratified by both governments in 2011 and went into effect in March 2012. Throughout 2012 and 2013 the economy experienced sluggish growth because of market slowdowns in the United States, China, and the Eurozone. The administration in 2014 is likely to face the challenge 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, dominance of large conglomerates (chaebols), and heavy reliance on exports, which comprise about half of GDP.

Source : CIA

Basic Information

Basic

Company Name	KUMKANG KIND CO., LTD.
Registered Address	110, Dasan-ro, Saha-gu, Busan, Korea (Old Address System : 1512-3, Dadae 1-dong, Saha-gu, Busan, Korea)
Zip Code	604-826
Tel	+82-51-264-8881
Fax	+82-51-264-2964
E-mail	webmaster@kumkang.com
Website	www.kumkangkind.com;www.kum-kang.com
Trading Address	Kumkang Kind Bldg., 1445-2, Seocho-dong, Seocho-gu, Seoul, Korea
Tel	+82-2-3415-4104
Fax	+82-2-3415-4165
Other Address-Eonyang Factory	140-25, Gacheon-ri, Samnam-myeon, Ulju-gun, Ulsan, Korea
Tel	+82-52-255-5300
Fax	+82-52-255-5319
Type	Export/Import
Industry	Manufacture of Pipes and Tubes, of Non-cast Iron or Steel
Main Business	Steel Pipe, Cramp, Panel Form, Aluminum Foam, Gang Forms, Construction Ashes, Clamp, Scaffolding Pipe, Supporting Frame
Sub Business	Manufacture of Structural Metal Sheet Products and Ornamental Metal Works Used on Building
Established (mm/dd/yyyy)	08/08/1979

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Ladders and scaffolding accessories(30191600)
Sell	Foams(13111300)
Sell	Fencing(30152000)
Sell	Step stool(30191505)
Sell	Clamps(31162900)
Sell	Beams(30101700)
Sell	Pipe(40142100)
Sell	Scaffolding(30191502)
Sell	Connecting or coupling pins(31162416)
Sell	Kick plates(30171513)
Sell	Steel plate(30102204)
Sell	Foundry molds(23161606)

CEO’s

Name	Jeon Jang-Yeol
Date of Birth	08/18/1952
Title	Chairman & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

24,869,695,000

Employees

422

Formation

Listed Company (Korea Stock Exchange : 014280) as of 09/10/1988

A Company of KUMKANG INDUSTRIAL GROUP

Bank Details

SC First Bank of Korea

Corporate Registered No.

180111-0034320

Business Registered No.

603-81-15882

Permit & Licenses

Int’l Trade No.: 900643

Shareholder Position

Name	Shares	%
AHN YOUNG-SOON	635,534	12.78
JEON JAE-BUM	341,698	6.87
JUNGWON ENGINEERING CO., LTD.(154511-0026066)	706,840	14.21
TREASURY STOCK	500,904	10.07
OTHERS	2,788,963	56.07
TOTAL	4,973,939	100.00

Company History

08/08/1979 Incorporated as KUMKANG STEEL PIPE CO., LTD.

12/31/1980 Changed company name to the present name

Detailed Information

Management

Job Description	Title	Name	Nationality	Date of Birth	Education
Chairman & CEO	Mr.	Jeon Jang-Yeol	Korean	1952.08.18	U.S.C, USA
President & CEO	Mr.	Lee Bum-Ho	Korean	1960.10.20	Gangnam University, Korea
Auditor	Mr.	Lee Won-Mo	Korean	1951.07.02	Kwangwun University, Korea
Outside Director	Mr.	Lee Sung-Oh	Korean	1953.06.05	Seoul National University, Korea
Sr. Executive Director	Mr.	Jeon Jae-Bum	Korean	1979.12.07	SUFFOLK

Financials

Year / Unit : KRW	Sales	Assets	Net Income
(*)03/2014	114,902,687,747	497,382,665,395	5,551,376,862
2013	424,978,192,982	489,779,880,244	12,835,143,035
2012	376,902,951,799	462,007,030,135	9,763,683,531
2011	289,006,169,082	390,653,177,821	2,001,120,856
2010	271,484,803,289	350,458,001,895	3,385,777,922
2009	237,751,394,481	295,387,320,762	7,396,386,179
2008	279,441,526,700	294,710,895,095	5,094,596,297
2007	230,959,498,239	267,304,989,572	1,566,912,661
2006	221,817,562,720	223,935,489,588	5,762,207,731
2005	214,392,622,843	197,540,640,293	6,472,807,609

(*)Figures are based on the K-IFRS Accounting System.

Financial Description

Authorized Capital(KRW)	70,000,000,000
Paid-Up Capital(KRW)	24,869,695,000
Total Issues Shares	4,973,939(Common : 4,855,964 / Preferable :117,975)

Balance Sheet
Unit : Korean Won	01/01/2014~03/31/2014	As of 12/31/2013	As of 12/31/2012
Total Assets	497,382,665,395	489,779,880,244	462,007,030,135
Current Assets	178,180,557,071	171,132,901,149	172,154,977,383
Cash & Cash Equivalents	38,634,684,638	34,036,399,414	33,043,580,994
Trade Receivables & Other Receivables	95,626,786,451	91,654,315,739	81,788,240,403
Current Financial Instruments	226,487,482	638,245,909	542,944,215
Inventories	42,557,368,630	43,812,571,442	55,195,934,025
Other Current Assets	1,135,229,870	991,368,645	1,584,277,746
Non-Current Assets	319,202,108,324	318,646,979,095	289,852,052,752
Tangibles	268,699,105,945	268,164,960,134	229,142,049,427
Intangibles	6,357,322,601	6,357,323,949	5,840,971,339
Investment_Real Estates	7,939,386,092	7,951,801,626	9,547,921,373
Investment_Subsidiaries	28,434,301,829	28,434,301,829	33,724,595,789
Non-Current Financial Instruments	6,392,864,855	6,346,962,555	9,647,733,855
Long-Term Trade Receivables & Other Receivables	1,379,127,002	1,391,629,002	1,948,780,969
Total Liabilities	301,635,697,094	298,048,836,838	278,043,767,346
Current Liabilities	268,183,866,643	262,719,890,022	194,451,423,881
Trade Payables & Other Payables	65,216,212,726	72,474,797,408	78,326,753,603
Other Current Borrowings	187,538,620,669	175,192,462,210	94,005,705,171
Other Current Liabilities	10,877,456,589	10,950,488,476	17,231,628,734
Accrued Income Tax	4,551,576,659	4,102,141,928	4,887,336,373
Non-Current Liabilities	33,451,830,451	35,328,946,816	83,592,343,465
Other Non-Current Borrowings	20,708,100,000	22,485,860,000	68,497,948,475
Other Non-Current Debts	3,969,264,432	4,004,264,432	4,343,801,932
Provision for Severance & Retirement	1,429,165,360	837,382,222	76,085,827
Deferred Income Tax Credit	6,532,791,491	7,199,109,782	9,978,313,324
Non-Current Provisions	812,509,168	802,330,380	696,193,907
Capital Stock	24,869,695,000	24,869,695,000	24,869,695,000
Capital Surplus	13,062,249,320	13,062,249,320	13,062,249,320
Other Capital	15,601,458,210	15,601,458,210	15,601,458,210
Others	480,608,748	429,204,954	1,875,084,030
Profit Surplus	141,732,957,023	137,768,435,922	128,554,776,229
Total Equity	195,746,968,301	191,731,043,406	183,963,262,789
Liab. & Shareholder’s Equity	497,382,665,395	489,779,880,244	462,007,030,135

Income Statement
Unit : Korean Won	01/01/2014~03/31/2014	As of 12/31/2013	As of 12/31/2012
Sales	114,902,687,747	424,978,192,982	376,902,951,799
Cost of Sold Goods	97,190,815,669	363,381,754,528	323,645,620,725
Gross Profit	17,711,872,078	61,596,438,454	53,257,331,074
Selling & Admin. Expenses	6,638,326,794	28,375,270,656	21,437,016,782
Logistics	2,580,804,156	11,045,196,251	9,301,612,636
Operating Income	8,492,741,128	22,175,971,547	22,518,701,656
Operating Income	1,074,532,043	5,971,677,893	2,363,202,298
Operating Expenses	341,967,867	2,700,467,980	3,734,631,313
Finance Income	105,365,022	610,291,160	944,879,797
Finance Expenses	2,228,752,526	9,161,716,011	9,846,945,778
Income Before Taxes	7,101,917,800	16,895,756,609	12,245,206,660
Income Taxes Expenses	1,550,540,938	4,060,613,574	2,481,523,129
Net Income	5,551,376,862	12,835,143,035	9,763,683,531

Cash Flows
Unit : Korean Won	01/01/2014~03/31/2014	As of 12/31/2013	As of 12/31/2012
Operating Activities Cash Flows	4,656,088,114	63,403,658,471	81,537,633,208
Net Income	5,551,376,862	12,835,143,035	9,763,683,531
Adjustment	18,245,785,484	49,749,518,454	37,923,566,623
Changes in Asset/ & Liability	-15,449,752,056	15,950,327,682	43,569,210,492
Dividends Received	61,700,000	627,591,130	605,170,275
Interests Received	195,015,976	684,938,230	1,058,592,964
Interests Paid	-2,170,459,234	-9,332,281,646	-9,295,301,792
Income Taxes	-1,777,578,918	-7,111,578,414	-2,087,288,885
Cash Flows from Investing	-10,623,994,326	-86,319,421,465	-83,340,156,148
Cash Flows from Financing	10,568,398,459	23,908,719,664	-6,844,355,904
Increase/Decrease in Cash	34,036,399,414	33,043,580,994	41,697,410,403
Cash at the Beginning of Year	4,598,285,224	992,818,420	-8,653,829,409
Cash at the End of Year	38,634,684,638	34,036,399,414	33,043,580,994
Operating Activities Cash Flows	4,656,088,114	63,403,658,471	81,537,633,208

Products, Technologies, Services Description

Main Products & Services

Steel Pipe, Cramp, Panel Form, Aluminum Foam, Gang Forms, Construction Ashes, Clamp, Scaffolding Pipe, Supporting Frame

Trade Partners & Competitors

Suppliers

POSCO(174611-0000741)

KOREA ZINC INC(110111-0168404)

GOGANG ALUMINIUM CO., LTD.(230111-0113719)

Competitors

SAMMOK PRECSION & IND CO., LTD.(110111-0400377)

HYUNDAI ALUMINUM CORPORATION(110111-2426264)

Related Parties (Subsidiaries, Joint-Venture & Affiliates)

Affiliates-Domestic

KOREA INDUSTRIAL CO., LTD.(180111-0001494)

KUMKANG FOSTEM CO., LTD.(110111-1243700)

DONG-SUH CHEMICAL IND CO., LTD.(174611-0000949)

KUMKANG INFORMATION SYSTEM CO., LTD.(110111-2793291)

BUSAN FRUTT & VEG CO., LTD.(180111-0148080)

D&A CO., LTD.(KOREA)

INSAN DIGICHEM CO., LTD.(110111-1700213)

EVERCOS CO., LTD.(184511-0013736)

KORYO CO., LTD.(KOREA)

HANKOOK KOTECH CO., LTD.(204611-0020651)

KOSLINE CO., LTD.(KOREA)

JUNGWON ENGINEERING CO., LTD.(154511-0026066)

DONGSEO ECO SOIL CO., LTD.(180111-0621143)

CASTEC CO., LTD.(160111-0075005)

GIMHAE LOGISTICS TERMINAL CO., LTD.(195511-0131395)

Affiliates-overseas

KUMKANG KIND(M) SDN,BHD(MALAYSIA)

KUMKANG KIND U.S.A., INC (USA)

KUMKANG KIND VIETNAM CO.,LTD.(VIETNAM)

KUMKANG KIND INDIA PRIVATE LIMITED.(INDIA)

DONGSUH INDONESIA.PT(INDONESAI)

Cooperative Enterprise

-Insured Company

SAMSUNG FIRE & MARINE INSURANCE CO., LTD.(110111-0005078)

Sales by Region (Activity & Markets)

Sales/ Unit :Mil KRW	03/2010	2010	2009
Export	13,899	62,711	33,336
Domestic	61,130	208,774	204,415
Total	75,029	271,485	237,751

The Subject deals with the companies in Japan, Malaysia, Singapore and USA.

News Clipping

Not Available

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.56
UK Pound	1	Rs.103.50
Euro	1	Rs.82.41

INFORMATION DETAILS

Analysis Done by :	DIV

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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