MIRA INFORM REPORT

Report Date :

13.12.2014

IDENTIFICATION DETAILS

Name :	DRAGON TECHNOLOGY DISTRIBUTION PTE. LTD.
Formerly Known As :	FE GLOBAL ELECTRONICS PTE LTD
Registered Office :	25, Kallang Avenue, 03- 06, 339416
Country :	Singapore
Financials (as on) :	31.12.2013
Date of Incorporation :	04.04.1990
Com. Reg. No.:	199001577-W
Legal Form :	Private Limited Company
Line of Business :	· wholesaler of electronic components.  · Subject offers a wide portfolio of semiconductor and system level solutions for customers including but not limited to Portable Electronics (e.g. Smart Phone, Feature Phone, Portable Navigation Device), Data Communication Products (Gateway, Router, PON, DWDM, MSPP/MSTP) and Digital Consumer Products (UMD, GPS, PMP, STB, Mobile TV).
No of Employees :	180 [2014]

RATING & COMMENTS

MIRA’s Rating :

B

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate
Payment Behaviour :	Slow
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 – September 30, 2014

Country Name	Previous Rating (30.06.2014)	Current Rating (30.09.2014)
Singapore	a1	a1

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

Singapore ECONOMIC OVERVIEW

Singapore has a highly developed and successful free-market economy. It enjoys a remarkably open and corruption-free environment, stable prices, and a per capita GDP higher than that of most developed countries. The economy depends heavily on exports, particularly in consumer electronics, information technology products, pharmaceuticals, and on a growing financial services sector. The economy contracted 0.6% in 2009 as a result of the global financial crisis, but rebounded 15.1% in 2010, on the strength of renewed exports, before slowing to in 2011-13, largely a result of soft demand for exports during the second European recession. Over the longer term, the government hopes to establish a new growth path that focuses on raising productivity. Singapore has attracted major investments in pharmaceuticals and medical technology production and will continue efforts to establish Singapore as Southeast Asia's financial and high-tech hub.

Source : CIA

EXECUTIVE SUMMARY

REGISTRATION NO.

:

199001577-W

COMPANY NAME

:

DRAGON TECHNOLOGY DISTRIBUTION PTE. LTD.

FORMER NAME

:

FE GLOBAL ELECTRONICS PTE LTD (30/04/2010)
FLEXTECH ELECTRONICS PTE LTD (24/05/2001)

INCORPORATION DATE

:

04/04/1990

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

25, KALLANG AVENUE, 03- 06, 339416, SINGAPORE.

BUSINESS ADDRESS

:

BLK 25, KALLANG AVENUE, #03-06, KALLANG BASIN INDUSTRIAL ESTATE, 339416, SINGAPORE.

TEL.NO.

:

65-62129629/62129800/62129858

FAX.NO.

:

65-62129630

CONTACT PERSON

:

SHANE PAUL MAINE ( DIRECTOR )

PRINCIPAL ACTIVITY

:

WHOLESALE OF ELECTRONIC COMPONENTS

ISSUED AND PAID UP CAPITAL

:

45,166,278.00 ORDINARY SHARE, OF A VALUE OF SGD 42,927,379.95 
2,000,000.00 ORDINARY SHARE, OF A VALUE OF USD 2,000,000.00 

SALES

:

USD 277,648,000 [2013]

NET WORTH

:

USD 25,436,000 [2013]

STAFF STRENGTH

:

180 [2014]

BANKER (S)

:

THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED

LITIGATION

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

Slow

MANAGEMENT CAPABILITY

:

AVERAGE

COMMERCIAL RISK

:

MODERATE

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

GOOD

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

HISTORY / BACKGROUND

The Subject is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the Subject must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the Subject is capable of owning assets, entering into contracts, sue or be sued by other companies. The liabilities of the shareholders are to the extent of the equity they have taken up and the creditors cannot claim on shareholders' personal assets even if the Subject is insolvent. The Subject is governed by the Companies Act and the company must file its annual returns, together with its financial statements with the Registrar of Companies.

The Subject is principally engaged in the (as a / as an) wholesale of electronic components.

The immediate holding company of the Subject is INFLEXIONPOINT ASIA PTE. LTD., a company incorporated in SINGAPORE.

Share Capital History

Date	Issue & Paid Up Capital
13/11/2014	SGD 42,927,379.95 & USD 2,000,000.00

The major shareholder(s) of the Subject are shown as follows :

Name	Address	IC/PP/Loc No	Shareholding	(%)
INFLEXIONPOINT ASIA PTE. LTD. [SGD (44,015,881) & USD (2,000,000)]	25, KALLANG AVENUE, 03-06, 339416, SINGAPORE.	201300634D	46,015,881.00	97.56
LOH SOON GNEE	16, SANDILANDS ROAD, 546080, SINGAPORE.	G5758424L	1,150,397.00	2.44
			---------------	------
			47,166,278.00	100.00
			============	=====

+ Also Director

The Subject's interest in other companies (Subsidiaries/Associates) are shown as follow :

Local No	Country	Company	(%)	As At
201222390W	SINGAPORE	INFLEXIONPOINT TECHNOLOGIES PTE. LIMITED	100.00	31/12/2013
	HONG KONG	FE GLOBAL (NORTH ASIA) LIMITED	100.00	31/12/2013
200106701M	SINGAPORE	FE-DECIBELS ELECTRONICS PTE LTD	100.00	31/12/2013
	SOUTH KOREA	FE GLOBAL ELECTRONICS KOREA LTD	100.00	31/12/2013
	MALAYSIA	DRAGAN TECHNOLOGY DISTRIBUTION SDN BHD	100.00	31/12/2013

DIRECTORS

DIRECTOR 1

Name Of Subject	:	SHANE PAUL MAINE
Address	:	FRITHAM COTTAGE, 108, HIGH STREET GREAT CHEVERELL, SN10, 4BX, UNITED KINGDOM.
IC / PP No	:	510559134
Nationality	:	BRITISH
Date of Appointment	:	03/05/2013

DIRECTOR 2

Name Of Subject	:	NEERAJ CHAUHAN
Address	:	2, EWE BOON ROAD, 20-01, THE PRINCETON, 259313, SINGAPORE.
IC / PP No	:	S7084949F
Nationality	:	SINGAPOREAN
Date of Appointment	:	03/05/2013

MANAGEMENT

1)	Name of Subject	:	SHANE PAUL MAINE
	Position	:	DIRECTOR

AUDITOR

Auditor	:	ERNST & YOUNG LLP
Auditor' Address	:	N/A

COMPANY SECRETARIES

1)	Company Secretary	:	ONG POH LENG
	IC / PP No	:	S7531079Z
	Address	:	1, PENSHURST PLACE, SERANGOON GARDEN ESTATE, 556417, SINGAPORE.

BANKING

Banking relations are maintained principally with :

1)

Name

:

THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED

ENCUMBRANCE (S)

Charge No	Creation Date	Charge Description	Chargee Name	Total Charge	Status
C201305656	25/04/2013	N/A	THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED	-	Unsatisfied
C201400825	20/01/2014	N/A	THE HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED	-	Unsatisfied

LITIGATION CHECK AGAINST SUBJECT

* A check has been conducted in our databank against the Subject whether the subject has been involved in any litigation.

No legal action was found in our databank.

No winding up petition was found in our databank.

PAYMENT RECORD

SOURCES OF RAW MATERIALS:
Local	:	N/A
Overseas	:	N/A

The Subject refused to disclose it's suppliers. 

The Subject refused to provide any name of trade/service supplier and we are unable to conduct any trade enquiry. However, from financial historical data we conclude that :

OVERALL PAYMENT HABIT
Prompt 0-30 Days	[	]	Good 31-60 Days	[		]	Average 61-90 Days	[	]
Fair 91-120 Days	[	]	Poor >120 Days	[	X	]

CLIENTELE

Local	:	YES
Domestic Markets	:	SINGAPORE
Overseas	:	YES
Export Market	:	CHINA KOREA
Credit Term	:	N/A
Payment Mode	:	N/A

OPERATIONS

Goods Traded

:

ELECTRONIC COMPONENTS

Total Number of Employees:
YEAR	2014	2013
GROUP	N/A	N/A
COMPANY	180	180

Branch

:

NO

Other Information:

The Subject is principally engaged in the (as a / as an) wholesale of electronic components. 

Dragon Technology Distribution ("DTD") is a pioneer in high technology industry and high speed communication market in Asia. As a leader in Telecom and Information Technology, DTD has developed close relationships with major component and system suppliers including Intel, Cortina, Semtech, PTI, Pericom, Emcore, Dialog, Rohm, Netronme, Vweb, and so on. 

DTD offers a wide portfolio of semiconductor and system level solutions for customers including but not limited to Portable Electronics (e.g. Smart Phone, Feature Phone, Portable Navigation Device), Data Communication Products (Gateway, Router, PON, DWDM, MSPP/MSTP) and Digital Consumer Products (UMD, GPS, PMP, STB, Mobile TV). Through offering a world class technical support services, Reference Designs and Full Turnkey Solutions, DTD has developed partnership relationships with many large, medium and small companies in Asia. 

RECENT DEVELOPMENT

Jan 15, 2013 

InflexionPoint Technologies is a global-focused IT supply chain company. This is the first investment by InflexionPoint which is in the process of aggregating IT Distribution companies in Asia. It recently announced a Share Purchase Agreement to acquire a majority share in a Singapore based IT Component Distributor, Dragon Technology Group.

CURRENT INVESTIGATION

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client	:	65 6212 9800
Current Telephone Number	:	65-62129629/62129800/62129858
Match	:	YES
Address Provided by Client	:	BLOCK 25, KALLANG AVENUE, #03-06 KALANG BASIN INDUSTRIAL ESTATE SINGAPORE 339416
Current Address	:	BLK 25, KALLANG AVENUE, #03-06, KALLANG BASIN INDUSTRIAL ESTATE, 339416, SINGAPORE.
Match	:	YES

Other Investigations

we contacted one of the staff from the Subject and she provided some information on the Subject.

FINANCIAL ANALYSIS

Profitability
Turnover	:	Increased	[	15.61%	]
Profit/(Loss) Before Tax	:	Decreased	[	216.74%	]
Return on Shareholder Funds	:	Unfavourable	[	(29.73%)	]
Return on Net Assets	:	Unfavourable	[	(18.72%)	]
The higher turnover could be attributed to the favourable market condition and the Subject could be gaining the market share progressively.The Subject incurred losses during the year due to the inefficient control of its operating costs. The Subject's unfavourable returns on shareholders' funds indicate the management's inefficiency in utilising its assets to generate returns.
Working Capital Control
Stock Ratio	:	Acceptable	[	61 Days	]
Debtor Ratio	:	Unfavourable	[	126 Days	]
Creditors Ratio	:	Unfavourable	[	114 Days	]
The Subject kept adequate stocks to meet its normal business transactions without incurring excessive storage costs. The Subject's debtors ratio was high. The Subject should tighten its credit control and improve its collection period. The unfavourable creditors' ratio could be due to the Subject taking advantage of the credit granted by its suppliers. However this may affect the goodwill between the Subject and its suppliers and the Subject may inadvertently have to pay more for its future supplies.
Liquidity
Liquid Ratio	:	Acceptable	[	0.81 Times	]
Current Ratio	:	Unfavourable	[	1.10 Times	]
The Subject's liquid ratio was slightly low. This could indicate that the Subject's working capital was slightly deficient. The Subject will have to improve its liquidity position either by obtaining short term financing or increase its paid up capital so that it can meet all its short term obligations as and when they fall due.
Solvency
Interest Cover	:	Unfavourable	[	(2.56 Times)	]
Gearing Ratio	:	Unfavourable	[	2.63 Times	]
The Subject incurred losses in the year. It did not generate sufficient income to service its interest.  If the situation does not improve, the Subject may be vulnerable to default in servicing the interest. The Subject was highly geared, thus it had a high financial risk. The Subject was dependent on loans to finance its business needs. In times of economic downturn and / or high interest rate, the Subject will become less profitable and competitive than other firms in the same industry, which are lowly geared. This is because the Subject has to service the interest and to repay the loan, which will erode part of its profits. The profits will fluctuate depending on the Subject's turnover and the interest it needs to pay.
Overall Assessment :
Although the Subject's turnover increased its profits however showed a reverse trend. The losses could be due to the management's failure to maintain its competitiveness in the market. The Subject's liquidity was at an acceptable range. If the Subject is able to obtain further short term financing, it should be able to meet all its short term obligations. The Subject's interest cover was negative, indicating that it did not generate sufficient income to service its interest. If its result does not show impressive improvements or succeed obtaining short term financing or capital injection, it may not be able to service its interest and repay the loans. The Subject's gearing level was high and its going concern will be in doubt if there is no injection of additional shareholders' funds in times of economic downturn and / or high interest rates.
Overall financial condition of the Subject : POOR

SINGAPORE ECONOMIC / INDUSTRY OUTLOOK

Major Economic Indicators :	2009	2010	2011	2012	2013
Population (Million)	4.98	5.08	5.18	5.31	5.40
Gross Domestic Products ( % )	(0.8)	14.5	4.9	1.3	3.7
Consumer Price Index	0.6	2.8	5.2	4.6	2.4
Total Imports (Million)	356,299.3	423,221.8	459,655.1	474,554.0	466,762.0
Total Exports (Million)	391,118.1	478,840.7	514,741.2	510,329.0	513,391.0
Unemployment Rate (%)	3.2	2.2	2.1	2.0	1.9
Tourist Arrival (Million)	9.68	11.64	13.17	14.49	15.46
Hotel Occupancy Rate (%)	75.8	85.6	86.5	86.4	86.3
Cellular Phone Subscriber (Million)	1.37	1.43	1.50	1.52	1.97
Registration of New Companies (No.)	26,414	29,798	32,317	31,892	37,288
Registration of New Companies (%)	4.3	12.8	8.5	(1.3)	9.8
Liquidation of Companies (No.)	22,393	15,126	19,005	17,218	17,369
Liquidation of Companies (%)	113.4	(32.5)	25.6	9.4	(5.3)
Registration of New Businesses (No.)	26,876	23,978	23,494	24,788	22,893
Registration of New Businesses (%)	8.15	(10.78)	2.02	5.51	1.70
Liquidation of Businesses (No.)	23,552	24,211	23,005	22,489	22,598
Liquidation of Businesses (%)	11.4	2.8	(5)	(2.2)	0.5
Bankruptcy Orders (No.)	2,058	1,537	1,527	1,748	1,992
Bankruptcy Orders (%)	(11.5)	(25.3)	(0.7)	14.5	14.0
Bankruptcy Discharges (No.)	3,056	2,252	1,391	1,881	2,584
Bankruptcy Discharges (%)	103.7	(26.3)	(38.2)	35.2	37.4
INDUSTRIES ( % of Growth ) :
Agriculture
Production of Principal Crops	3.25	(0.48)	4.25	3.64	-
Fish Supply & Wholesale	(1.93)	(10.5)	12.10	(0.5)	-
Manufacturing *	71.5	92.8	100.0	100.3	102.0
Food, Beverages & Tobacco	90.4	96.4	100.0	103.5	103.5
Textiles	145.9	122.1	100.0	104.0	87.1
Wearing Apparel	211.0	123.3	100.0	92.1	77.8
Leather Products & Footwear	79.5	81.8	100.0	98.6	109.8
Wood & Wood Products	101.4	104.0	100.0	95.5	107.4
Paper & Paper Products	95.4	106.1	100.0	97.4	103.2
Printing & Media	100.9	103.5	100.0	93.0	86.1
Crude Oil Refineries	96.4	95.6	100.0	99.4	93.5
Chemical & Chemical Products	80.3	97.6	100.0	100.5	104.1
Pharmaceutical Products	49.1	75.3	100.0	109.7	107.2
Rubber & Plastic Products	101.2	112.3	100.0	96.5	92.9
Non-metallic Mineral	91.9	92.5	100.0	98.2	97.6
Basic Metals	92.6	102.2	100.0	90.6	76.5
Fabricated Metal Products	90.8	103.6	100.0	104.3	105.1
Machinery & Equipment	57.3	78.5	100.0	112.9	114.5
Electrical Machinery	86.8	124.1	100.0	99.3	108.5
Electronic Components	85.2	113.6	100.0	90.6	94.3
Transport Equipment	96.0	94.0	100.0	106.3	107.5
Construction	(36.9)	14.20	20.50	28.70	-
Real Estate	1.4	21.3	25.4	31.9	-
Services
Electricity, Gas & Water	1.70	4.00	7.00	6.30	-
Transport, Storage & Communication	3.90	12.80	7.40	5.30	-
Finance & Insurance	(16.4)	(0.4)	8.90	0.50	-
Government Services	4.50	9.70	6.90	6.00	-
Education Services	0.10	(0.9)	(1.4)	0.30	-
* Based on Index of Industrial Production (2011 = 100)
(Source : Department of Statistics)

INDUSTRY ANALYSIS

INDUSTRY :	TRADING
The wholesale and retail trade sectors have expanded by 2.0% in the third quarter of 2014, extending the 1.8 per cent growth in the previous quarter. In 2013, the wholesale and retail sector expanded by 5.0%, after declining by 1.4% the year before. Growth of the sector was driven by the wholesale trade segment.
The domestic wholesale trade index has increased by 3.2% in the fourth quarter of 2013, moderating from the 6.6% growth in the previous quarter. The slower growth was due to a decline in the sales of furniture and household equipment (-12%) and petroleum and petroleum products (-0.6%). For the full year, the domestic wholesale trade index grew by 5.2% reversing the 2.2% decline in 2012. On the other hand, the foreign wholesale trade index has increased by a slower pace of 5.6% in the fourth quarter, compared to the 7.7% expansion in the preceding quarter. The slowdown was due to a fall in the sales of telecommunication equipment and computer (-3.8%) and petroleum and petroleum products (-2.5%). For the full year, the growth of the foreign wholesale trade index moderated slightly to 8.6% from 9.1% in the previous year.
In the fourth quarter of 2013, retail sales volume fell by 6.2%, extending the 5.6% decline in the previous quarter. Excluding motor vehicles, retail sales volume increased by 0.4%, a slower pace of expansion as compared to the 1.6% gain in the preceding quarter. The sales volume of motor vehicles fell by 33% in the fourth quarter of 2013, extending the 32% decline in the previous quarter. Meanwhile, the sales of several discretionary items also fell in the fourth quarter of 2013. For instance, the sales of telecommunications apparatus and computers fell by 12%, while the sales of furniture and household equipment declined by 5.4%.
For the full year, retail sales volume contracted by 4.3%, a reversal from the 1.3% expansion in 2012. Excluding motor vehicle sales, the retail sales volume grew by 1.1% in 2013, slower than the 1.7% increase in 2012. Watches and jewellery recorded the largest increase (11%) in sales in 2013, followed by optical goods and book (3%) and medical goods and toiletries (3%). By contrast, the sales of telecommunications apparatus and computer (-7.3%), furniture and household equipment (-4.2%) and petrol service stations (-1.4) declined in 2013.
OVERALL INDUSTRY OUTLOOK : AVERAGE GROWTH

CREDIT RISK EVALUATION & RECOMMENDATION

Incorporated in 1990, the Subject is a Private Limited company, focusing on wholesale of electronic components. The Subject has been in business for over two decades. It has built up a strong clientele base and good reputation will enable the Subject to further enhance its business in the near term. The Subject is expected to enjoy a stable market shares. Presently, the issued and paid up capital of the Subject stands at SGD 42,927,380 & USD 2,000,000. The Subject have a strong support from its holding company. 

Over the years, the Subject has penetrated into both the local and overseas market. The Subject has positioned itself in the global market and is competing in the industry. Its stable clientele base will enable the Subject to further enhance its business in the near term. The Subject is a fairly large and rapidly growing company with over 180 staff in its operations Overall, we regard that the Subject's management capability is average. This indicates that the Subject has greater potential to improve its business performance and raising income for the Subject. 

Despite the higher turnover, the Subject suffered pre-tax losses which reflected a highly competitive business environment. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. The Subject managed to maintain an adequate liquidity level, indicating that the Subject has the ability to meet its financial obligations. The high gearing ratio clearly implied that the Subject was supported by more debt than equity. Thus, the Subject is exposed to high financial risk. Given a positive net worth standing at USD 25,436,000, the Subject should be able to maintain its business in the near terms. 

Without a strong assets backing, the Subject may face difficulties in getting loans for its future expansion and continued growth . 

The poor payment habit may affect the goodwill between the Subject and its suppliers and the Subject may inadvertently have to pay more for its future supplies. 

The industry shows an upward trend and this trend is very likely to sustain in the near terms. 

In view of the above, we recommend credit be granted to the Subject with close monitoring.

PROFIT AND LOSS ACCOUNT

THE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH SINGAPORE FINANCIAL REPORTING STANDARDS.

DRAGON TECHNOLOGY DISTRIBUTION PTE. LTD.

Financial Year End	2013-12-31	2012-12-31	2011-12-31
Months	12	12	12
Consolidated Account	GROUP	GROUP	Company
Audited Account	YES	YES	YES
Unqualified Auditor's Report (Clean Opinion)	YES	YES	YES
Financial Type	FULL	FULL	FULL
Currency	USD	USD	USD
TURNOVER	277,648,000	240,153,000	73,406,133
Other Income	629,000	821,000	1,230,303
	----------------	----------------	----------------
Total Turnover	278,277,000	240,974,000	74,636,436
Costs of Goods Sold	(258,205,000)	(222,945,000)	(67,668,069)
	----------------	----------------	----------------
Gross Profit	20,072,000	18,029,000	6,968,367
	----------------	----------------	----------------
PROFIT/(LOSS) FROM OPERATIONS	(6,758,000)	5,789,000	1,377,415
	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE TAXATION	(6,758,000)	5,789,000	1,377,415
Taxation	(616,000)	(266,000)	(151,124)
	----------------	----------------	----------------
PROFIT/(LOSS) AFTER TAXATION	(7,374,000)	5,523,000	1,226,291
Minority interests	(217,000)	(108,000)	-
Pre-acquisition profit/(loss)	29,000	2,000	-
	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE EXTRAORDINARY ITEMS	(7,562,000)	5,417,000	1,226,291
	----------------	----------------	----------------
PROFIT/(LOSS) ATTRIBUTABLE TO SHAREHOLDERS	(7,562,000)	5,417,000	1,226,291
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported	17,165,000	3,246,666	2,020,375
Prior year adjustment	-	8,501,334	-
	----------------	----------------	----------------
As restated	17,165,000	11,748,000	2,020,375
	----------------	----------------	----------------
PROFIT AVAILABLE FOR APPROPRIATIONS	9,603,000	17,165,000	3,246,666
DIVIDENDS - Ordinary (paid & proposed)	(13,000,000)	-	-
	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD	(3,397,000)	17,165,000	3,246,666
	=============	=============	=============
INTEREST EXPENSE (as per notes to P&L)
Term loan / Borrowing	73,000	268,000	-
Others	1,825,000	1,602,000	765,347
	----------------	----------------	----------------
	1,898,000	1,870,000	765,347
	=============	=============	=============

BALANCE SHEET

DRAGON TECHNOLOGY DISTRIBUTION PTE. LTD.

ASSETS EMPLOYED:
FIXED ASSETS	791,000	536,000	332,108
LONG TERM INVESTMENTS/OTHER ASSETS
Subsidiary companies	-	-	21,460,679
Associated companies	-	-	3,217
Deferred assets	366,000	213,000	257,000
	----------------	----------------	----------------
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS	366,000	213,000	21,720,896
INTANGIBLE ASSETS
Deferred/Expenditure carried forward	-	370,000	-
Goodwill on consolidation	9,122,000	2,640,000	-
Others	9,000	1,086,000	30,778
	----------------	----------------	----------------
TOTAL INTANGIBLE ASSETS	9,131,000	4,096,000	30,778
	----------------	----------------	----------------
TOTAL LONG TERM ASSETS	10,288,000	4,845,000	22,083,782
Stocks	46,539,000	23,624,000	8,319,736
Trade debtors	96,214,000	49,074,000	14,230,203
Other debtors, deposits & prepayments	3,107,000	838,000	178,086
Short term deposits	3,863,000	6,759,000	-
Amount due from holding company	18,264,000	16,322,000	-
Amount due from related companies	-	7,584,000	13,282,285
Cash & bank balances	8,709,000	11,332,000	5,319,389
	----------------	----------------	----------------
TOTAL CURRENT ASSETS	176,696,000	115,533,000	41,329,699
	----------------	----------------	----------------
TOTAL ASSET	186,984,000	120,378,000	63,413,481
	=============	=============	=============
CURRENT LIABILITIES
Trade creditors	80,699,000	26,047,000	12,056,607
Other creditors & accruals	9,717,000	3,649,000	127,913
Bill & acceptances payable	66,444,000	23,488,000	7,650,409
Amounts owing to holding company	-	2,280,000	-
Amounts owing to related companies	-	5,000	5,382,875
Amounts owing to associated companies	-	54,000	-
Amounts owing to director	3,798,000	-	-
Provision for taxation	366,000	215,000	-
Other liabilities	-	19,320,000	7,259,865
	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	161,024,000	75,058,000	32,477,669
	----------------	----------------	----------------
NET CURRENT ASSETS/(LIABILITIES)	15,672,000	40,475,000	8,852,030
	----------------	----------------	----------------
TOTAL NET ASSETS	25,960,000	45,320,000	30,935,812
	=============	=============	=============
SHARE CAPITAL
Ordinary share capital	27,689,000	27,689,000	27,689,146
	----------------	----------------	----------------
TOTAL SHARE CAPITAL	27,689,000	27,689,000	27,689,146
Capital reserve	(422,000)	(422,000)	-
Exchange equalisation/fluctuation reserve	(276,000)	(296,000)	-
Retained profit/(loss) carried forward	(3,397,000)	17,165,000	3,246,666
	----------------	----------------	----------------
TOTAL RESERVES	(4,095,000)	16,447,000	3,246,666
MINORITY INTEREST	1,842,000	512,000	-
	----------------	----------------	----------------
SHAREHOLDERS' FUNDS/EQUITY	25,436,000	44,648,000	30,935,812
Long term loans	458,000	606,000	-
Deferred taxation	66,000	66,000	-
	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	524,000	672,000	-
	----------------	----------------	----------------
	25,960,000	45,320,000	30,935,812
	=============	=============	=============

FINANCIAL RATIO

DRAGON TECHNOLOGY DISTRIBUTION PTE. LTD.

TYPES OF FUNDS
Cash	12,572,000	18,091,000	5,319,389
Net Liquid Funds	(53,872,000)	(5,397,000)	(2,331,020)
Net Liquid Assets	(30,867,000)	16,851,000	532,294
Net Current Assets/(Liabilities)	15,672,000	40,475,000	8,852,030
Net Tangible Assets	16,829,000	41,224,000	30,905,034
Net Monetary Assets	(31,391,000)	16,179,000	532,294
BALANCE SHEET ITEMS
Total Borrowings	66,902,000	24,094,000	7,650,409
Total Liabilities	161,548,000	75,730,000	32,477,669
Total Assets	186,984,000	120,378,000	63,413,481
Net Assets	25,960,000	45,320,000	30,935,812
Net Assets Backing	25,436,000	44,648,000	30,935,812
Shareholders' Funds	25,436,000	44,648,000	30,935,812
Total Share Capital	27,689,000	27,689,000	27,689,146
Total Reserves	(4,095,000)	16,447,000	3,246,666
LIQUIDITY (Times)
Cash Ratio	0.08	0.24	0.16
Liquid Ratio	0.81	1.22	1.02
Current Ratio	1.10	1.54	1.27
WORKING CAPITAL CONTROL (Days)
Stock Ratio	61	36	41
Debtors Ratio	126	75	71
Creditors Ratio	114	43	65
SOLVENCY RATIOS (Times)
Gearing Ratio	2.63	0.54	0.25
Liabilities Ratio	6.35	1.70	1.05
Times Interest Earned Ratio	(2.56)	4.10	2.80
Assets Backing Ratio	0.61	1.49	1.12
PERFORMANCE RATIO (%)
Operating Profit Margin	(2.43)	2.41	1.88
Net Profit Margin	(2.72)	2.26	1.67
Return On Net Assets	(18.72)	16.90	6.93
Return On Capital Employed	(13.16)	15.34	6.92
Return On Shareholders' Funds/Equity	(29.73)	12.13	3.96
Dividend Pay Out Ratio (Times)	1.72	0.00	0.00
NOTES TO ACCOUNTS
Contingent Liabilities	0	0	0

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.44
UK Pound	1	Rs.98.15
Euro	1	Rs.77.38

INFORMATION DETAILS

Analysis Done by :	DIV
Report Prepared by :	MNL

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.