MIRA INFORM REPORT

Report Date :

21.08.2014

IDENTIFICATION DETAILS

Name :	DRESSER MACHINERY (SUZHOU) CO., LTD.
Registered Office :	No. 81, Suhong Middle Road, Industrial Park, Suzhou, Jiangsu Province, 215021 PR
Country :	China
Financials (as on) :	31.12.2013
Date of Incorporation :	28.05.2014
Com. Reg. No.:	320594400009093
Legal Form :	Wholly Foreign-Owned Enterprise
Line of Business :	Manufacturing and selling valve products, blowers, gas equipment.
No. of Employees :	250

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

DRESSER MACHINERY (SUZHOU) CO., LTD.

NO. 81, SUHONG MIDDLE ROAD, INDUSTRIAL PARK,

SUZHOU, JIANGSU PROVINCE, 215021 PR CHINA

TEL: 86 (0) 512-62588715 FAX: N/A

EXECUTIVE SUMMARY

INCORPORATION DATE : MAY 28, 2004

REGISTRATION NO. : 320594400009093

REGISTERED LEGAL FORM : WHOLLY FOREIGN-OWNED ENTERPRISE

CHIEF EXECUTIVE : MR. xiang lei (CHAIRMAN)

STAFF STRENGTH : 250

REGISTERED CAPITAL : usd 4,700,000

BUSINESS LINE : manufacturing and TRADING

TURNOVER : CNY 286,300,000 (AS OF DEC. 31, 2013)

EQUITIES : CNY 49,070,000 (AS OF DEC. 31, 2013)

PAYMENT : AVERAGE

MARKET CONDITION : AVERAGE

FINANCIAL CONDITION : FAIRLY STABLE

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.1524 = 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 was registered as a wholly foreign-owned enterprise at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on May 28, 2004.

Company Status: Wholly foreign-owned enterprise

This form of business in PR China is defined as a legal person. It is a limited co. established within the territories of PR China with capital provided totally by the foreign investors. More than one foreign investor may jointly invest in a wholly foreign-owned enterprise. The investing party/parties solely exercise management, reap profit and bear risks and liabilities by themselves. This form of companies usually have a limited duration is extendible upon approval of Examination and Approval Authorities.

SC’s registered business scope includes general business items: manufacturing low power pneumatic control valves and other valve products, blowers and related parts, gas equipment (regulator), roots vacuum pumps and equipment, centrifugal compressors and equipment, selling self-produced products and providing related maintenance and after-sales service; computer software, systems integration and technology development and testing; wholesale business, commission agency (excluding auction), import and export and related services of similar products; providing business information services (shall not engage in debt restructuring, debt recovery and other non-performing assets from operating activities).

SC is mainly engaged in manufacturing and selling valve products, blowers, gas equipment

Mr. Xiang Lei is legal representative and chairman of SC at present.

SC is known to have approx. 250 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office and factory in the industrial park of Suzhou. Our checks reveal that SC rents the total premise, but the gross area of the premise is unspecific.

SC is not known to host website of its own at present.

No significant changes were found during our checks with the local Administration for Industry and Commerce.

Organization code: 762449904

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

MAIN SHAREHOLDERS:

Name % of Shareholding

Dresser China, Inc. 100

Note: the nationality of the shareholder is not available.

l Legal Representative and Chairman:

Mr. Xiang Lei is currently responsible for the overall management of SC.

Working Experience(s):

At present Working in SC as legal representative and chairman.

l General Manager:

Mr. Chen Shuo is currently responsible for the daily management of SC.

Working Experience(s):

At present Working in SC as general manager.

l Directors:

Wang Junfeng

Guo Qi

Xu Xin

l Supervisor:

Thomas Dylan Cannon

SC is mainly engaged in manufacturing and selling valve products, blowers, gas equipment.

SC’s products mainly include valve products, blowers, gas equipment, etc.

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

TRADEMARKS & PATENTS

No record

Note: SC’s management declined to release its main clients and suppliers.

Dresser Wayne Fuel Equipment (Shanghai) Co., Ltd.

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

Incorporation Date : Feb. 8, 1993

Registration No. : 310115400007891

Registered Legal Form : Wholly Foreign-Owned Enterprise

Legal Rep. : Li Haiming

Registered Capital : USD 34,300,000

Add : No. 51, Daxiu Road, Pudong New Area, Shanghai

Tel : 86 (0) 21-58993703/58589000

Fax : 86 (0) 21-58990974/58582191

Dresser Wayne Data Technology (Shanghai) Co., Ltd.

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

Incorporation Date : Sep. 24, 2001

Registration No. : 310115400084372

Registered Legal Form : Wholly Foreign-Owned Enterprise

Legal Rep. : Li Haiming

Registered Capital : USD 200,000

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.

China Construction Bank Suzhou Industrial Park Sub-branch

AC#：N/A

Relationship: Normal.

Financial Information

Unit: CNY’000

	as of Dec. 31, 2013
Total liabilities	100,790
Equities	49,070
	--------------
Total assets	149,860
	=========
Turnover	286,300
Profits	4,150

Note: SC’s accountant refused to release the detailed financial reports for Yr2013.

Important Ratios

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

	as of Dec. 31, 2013
*Liabilities to assets	0.67
*Net profit margin (%)	1.45
*Return on total assets (%)	2.77
*Turnover/Total assets	1.91

PROFITABILITY: AVERAGE

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

l SC’s net profit margin is average.

l SC’s return on total assets is average.

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

LEVERAGE: AVERAGE

l The debt ratio of SC is average.

l 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.60.66
UK Pound	1	Rs.100.80
Euro	1	Rs.80.72

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.