MIRA INFORM REPORT

Report Date :

15.12.2014

IDENTIFICATION DETAILS

Name :	TK CHEMICAL CORPORATION

Registered Office :	128, Wondae-ro, Buk-gu, Daegu 3FL., Yeonwoo Bldg. 702-857

Country :	South Korea

Financials (as on) :	30.09.2014

Date of Incorporation :	07.11.2007

Com. Reg. No.:	107-87-01960

Legal Form :	Listed Company

Line of Business :	Manufacture of Synthetic Fibers.

No of Employees :	824

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 :	Exists

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)

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

Company Name and address

Company Name	TK CHEMICAL CORPORATION
Registered Address	128, Wondae-ro, Buk-gu, Daegu, Korea (Old Address System : 416-8, Chimsan 3-dong, Buk-gu, Daegu, Korea)
Building	3FL., Yeonwoo Bldg.
Zip Code	702-857
Tel	+82-53-252-4177
Fax	+82-53-253-5216
E-mail	webmaster@tkchemi.co.kr;philiplee@tkchemi.co.kr
Website	www.tkchemi.co.kr
Trading Address	9FL., Jinduk Bldg., 22, Seonyudong 1-ro, Yeongdeungpo-gu, Seoul, Korea (Old Address System : 9FL., Jinduk Bldg., 160-2, Dangsan-dong 2-ga, Yeongdeungpo-gu, Seoul, Korea)
Tel	+82-2-2001-6000
Fax	+82-2-2001-6180 +82-2-782-1160 +82-2-780-5263
Other Address-Synthetic 1 Factory	298-1, Gongdan-dong, Gumi-si, Gyeongbuk, Korea
Tel	+82-54-461-3401
Fax	+82-54-461-8100
Other Address-Synthetic 2 Factory	291-20, Gongdan-dong, Gumi-si, Gyeongbuk, Korea
Tel	+82-54-461-6055
Fax	+82-54-462-0460
Other Address-Synthetic 3 Factory	520, Jung-ri, Seokjeok-eup, Chilgok-gun, Gyeongbuk, Korea
Tel	+82-54-971-9051
Fax	+82-54-971-9051
Other Address-Resin Factory	300, Gongdan-dong, Gumi-si, Gyeongbuk, Korea
Tel	+82-54-463-0380
Fax	+82-54-461-3922
Other Address-Daegu Office	103-6, Dongsan-dong, Jung-gu, Daegu, Korea
Tel	+82-53-252-4177
Fax	+82-53-252-4177
Type	Export/Import
Industry	Manufacture of Synthetic Fibers
Main Business	Polyester Yarn, Spandex Yarn, Cotton Yarn, PET Resin, Chip
Sub Business
Established (mm/dd/yyyy)	11/07/2007

The Subject occupies the premises of registered HQ address by leasing base.

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Polyester yarn(11151703)
Sell	Cotton yarn(11151702)
Sell	Resins(13111000)

CEO’s

Name	Kim Hae-Kyu
Address
Date of Birth	03/1963
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

45,000,000,000

Employees

824

Formation

Listed Company (KOSDAQ : 104480) as of 04/26/2011

Foreign Direct Investment Corporation

A Company of SM GROUP

Bank Details

Woori Bank-Yeoido Central Branch

Korea Development Bank

SC. First Bank of Korea

Corporate Registered No.

110111-3783457

Business Registered No.

107-87-01960

Permit & Licenses

Int’l Trade No.: 45338773

Shareholder Position

Name	Shares	%
SMT CHEMICAL CO., LTD.(170111-0351776)	18,065,530	20.07
DAEWOO INTERNATIONAL CORPORATION(110111-2137358)	8,000,000	8.89
WOOBANG INDUSTRIES CO., LTD.(110111-0002834)	11,800,000	13.11
WOOBANG CONSTRUCTION CO.,LTD.(170111-0352732)	12,499,270	13.89
TREASURY STOCK	4,675,998	5.20
OTHERS	34,959,202	38.84
TOTAL	90,000,000	100.00

Company History

11/07/2007 Incorporated as the present name

12/26/2007 Increased the authorized shares to 20,000,000 shares from 40,000 shares

01/22/2008 Moved to the present address from 17-26, Yeoeuido-dong, Yeongdeungpo-gu, Seoul, Korea

01/31/2008 Acquired Spandex, Polyester, Resin Business from TONGKOOK CORP.(110111-0059950)

02/05/2008 Increased capital to 40,000,000,000 KRW from 50,000,000 KRW

07/17/2008 Registered as a Foreign Direct Investment Corporation

07/18/2008 Changed stock type to 8,000,000 shares (Common:5,300,653, Preferable:2,699,347) from 8,000,000 shares (Common: 8,000,000)

04/26/2011 Increased capital to 45,000,000,000 KRW from 40,000,000,000 KRW

07/01/2011 Moved to the present HQ address registration from 14th Fl., Korea Sinsong Center Bldg., 25-12, Yeoeuido-dong, Yeongdeungpo-gu, Seoul, Korea

Management

Job Description	Title	Name	Sex	Nationality	Date of Birth
President & CEO	Mr.	Kim Hae-Kyu	Male	Korean	1963.03
Chairman	Mr.	Woo Oh-Hyun	Male	Korean	1953.11.06
Director	Mr.	Kim Yong-Wan	Male	Korean	1956.03
Auditor	Mr.	Bae Soon-Ki	Male	Korean	1957.07.08
Auditor	Mr.	Kim Ki-Ho	Male	Korean	1962.10
Director	Mr.	Kwak Jin-Soo	Male	Korean	1964.08
Outside Director	Mr.	Lee Sung-Wook	Male	Korean	1956.09
Outside Director	Mr.	Cho Gye-Yong	Male	Korean	1953.05

Financials

Year / Unit : KRW	Sales	Assets	Net Income
(*)09/2014	589,187,725,926	618,798,223,127	13,303,498,992
(*)2013	848,025,474,441	532,727,301,778	11,631,633,966
(*)2012	852,763,702,460	474,029,741,985	-28,503,136,674
(*)2011	1,000,564,178,112	666,314,510,118	38,165,046,662
(*)2010	882,043,327,810	457,268,415,266	26,155,939,425
2009	777,194,493,448	323,556,543,330	25,632,641,591
2008	710,630,616,602	320,963,467,180	-17,308,870,150
2007	-	48,690,862	(-)456,138

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

Financial Description

Authorized Capital(KRW)	100,000,000,000
Paid-Up Capital(KRW)	45,000,000,000
Total Issues Shares	90,000,000

Balance Sheet
Unit : Korean Won	01/01/2014~09/30/2014	As of 12/31/2013	As of 12/31/2012
Total Assets	618,798,223,127	532,727,301,778	474,029,741,985
Current Assets	233,431,346,482	159,010,189,397	193,956,056,724
Cash & Cash Equivalents	4,534,396,176	8,169,609,270	51,840,353,962
Current Financial Instruments	960,000,000	2,271,263,158	9,426,502,801
Trade Receivables & Other Receivables	66,284,418,686	79,828,243,326	61,536,130,391
Inventories	133,098,324,806	64,203,602,926	65,263,078,012
Deferred Income Tax Assets	51,114,940	168,488,570	786,501,240
Other Current Non-Financial Assets	7,455,932,786	2,206,312,786	2,357,132,786
Other Receivables	18,776,036,496	0	0
Other Current Assets	2,271,122,592	2,162,669,361	2,746,357,532
Non-Current Assets	385,366,876,645	373,717,112,381	280,073,685,261
Non-Current Financial Instruments	103,000,000	103,000,000	103,000,000
Long-Term Trade Receivables & Other Receivables	0	0	433,201,082
Non-Current Marketable Financial Instruments	1,184,102,000	1,184,102,000	2,153,102,000
Investment_Related Companies	177,439,939,080	154,854,490,390	50,630,337,405
Tangibles	203,709,670,993	214,366,564,836	222,073,191,825
Investment_Real Estates	837,900,000	837,900,000	837,900,000
Intangibles	913,496,048	1,366,937,631	1,366,937,631
Non-Current Financial Instruments	1,135,796,801	958,036,097	1,310,257,560
Other Non-Current Assets	42,971,723	46,081,427	48,526,355
Deferred Income Tax Assets	0	0	1,117,231,403
Total Liabilities	407,246,184,268	334,269,810,680	284,822,694,747
Current Liabilities	345,752,297,969	293,259,906,541	231,809,257,356
Trade Payables & Other Payables	108,797,149,533	132,286,846,119	79,002,075,318
Short-Term Borrowings	234,154,343,997	158,571,820,515	150,691,093,228
Other Current Financial Debts	1,186,043,000	1,182,741,400	1,229,395,000
Other Current Liabilities	1,614,761,439	1,218,498,507	886,693,810
Non-Current Liabilities	61,493,886,299	41,009,904,139	53,013,437,391
Long-Term Borrowings	35,425,000,000	15,700,000,000	25,000,000,000
Confirmed Salaries	23,085,433,704	24,195,689,459	27,725,667,881
Deferred Income Tax Credit	2,948,483,095	1,079,245,180	0
Other Non-Current Financial Debts	34,969,500	34,969,500	287,769,510
Capital Stock	45,000,000,000	45,000,000,000	45,000,000,000
Capital Surplus	118,784,676,063	118,784,676,063	118,797,004,830
Profit Surplus	41,849,359,215	28,587,178,852	15,054,821,440
Others	5,918,003,581	6,085,636,183	10,355,220,968
Total Equity	211,552,038,859	198,457,491,098	189,207,047,238
Liab. & Shareholder’s Equity	618,798,223,127	532,727,301,778	474,029,741,985

Income Statement
Unit : Korean Won	01/01/2014~09/30/2014	As of 12/31/2013	As of 12/31/2012
Sales	589,187,725,926	848,025,474,441	852,763,702,460
Cost of Sold Goods	562,708,088,120	819,435,007,599	830,228,534,140
Gross Profit	26,479,637,806	28,590,466,842	22,535,168,320
Selling & Admin. Expenses	22,397,235,703	28,268,646,084	36,223,990,094
Operating Income	4,082,402,103	321,820,758	-13,688,821,774
Non-Operating Income	158,774,209	236,233,966	971,660,601
Non-Operating Expenses	2,427,439,387	3,952,126,376	3,755,859,277
Finance Income	3,357,886,092	7,175,204,703	10,694,069,272
Finance Expenses	12,814,390,095	15,138,561,346	17,721,591,892
Profits from Equity Method	22,798,522,156	26,473,353,507	-11,414,331,849
Income Before Taxes	15,155,755,078	15,115,925,212	-34,914,874,919
Income Taxes Expenses	1,852,256,086	3,484,291,246	-5,520,583,794
Income from Continuous Business	13,303,498,992	11,631,633,966	-29,394,291,125
Income from Stopped Business	0	0	891,154,451
Net Income	13,303,498,992	11,631,633,966	-28,503,136,674

Cash Flows
Unit : Korean Won	01/01/2014~09/30/2014	As of 12/31/2013	As of 12/31/2012
Operating Activities Cash Flows	-78,304,501,291	56,182,717,438	-41,111,647,330
Changes in Asset/ & Liability	-103,327,763,066	32,479,013,893	-58,856,048,382
Cash Flows from Investing	-12,593,728,805	-91,400,997,973	-12,243,327,144
Cash Inflow from Investing	31,099,775,490	28,227,051,747	73,354,680,932
Cash Outflows for Investing	-43,693,504,295	-119,628,049,720	-74,056,884,863
Cash Flows from Financing	87,222,820,458	-8,452,495,603	25,815,684,076
Cash Inflows from Financing	390,561,748,638	1,071,514,118,349	912,119,401,738
Cash Outflows from Financing	-303,338,928,180	-1,079,966,613,952	-886,226,823,981
Increase/Decrease in Cash	-3,675,409,638	-43,670,776,138	-27,539,290,398
Cash at the Beginning of Year	8,169,609,270	51,840,353,962	79,781,319,353
Cash at the End of Year	4,534,396,176	8,169,609,270	51,840,353,962

Products, Technologies, Services Description

Main Products & Services

Polyester Yarn (Full Dull, Middle Dull, Cation Dyable, High Shrinkage, Supper Bright, Bright)

SPANDEX Yarn

CHIP(FD, CD, HS)

Resin for PET Bottle

Brand Name: TexPet, ARACHRA, TEXLON

Trade Partners & Competitors

Suppliers

SAMSUNG PETROCHEMICAL CO., LTD.(181211-0000435)

Customers

DAEWOO INTERNATIONAL CORPORATION(110111-2137358)

LG INTERNATIONAL CORP(110111-0004632)

BURIM CHEMICAL CO., LTD.(111511-0005508)

KIPSCO(KOREA)

YOONSE TONGSANG CO., LTD.(KOREA)

Competitors

TAEKWANG INDUSTRIAL CO., LTD.

162-1, JANGCHUNGDONG 2-GA, JUNG-GU, SEOUL, KOREA

TEL:+82-2-3406-0300 FAX:+82-2-2273-9166

HUVIS CORP.

HUVIS BLDG., 151-7, SAMSEONG 1-DONG, GANGNAM-GU, SEOUL, KOREA

TEL:+82-2-2189-4567 FAX:+82-2-2189-4569

WOONGJIN CHEMICAL CO., LTD.

287, GONGDAN 2-DONG, GUMI-SI, GYEONGSANGBUK-DO, KOREA

TEL:+82-54-469-4114 FAX:+82-54-469-4444

Related Parties (Subsidiaries, Joint-Venture & Affiliates)

Affiliates-Domestic	NAMSUN ALUMINIUM CO.,LTD.(170111-0005042) SAMRA CONSTRUCTION CO., LTD. (200111-0013220) JINDUK CO., LTD.(110111-0002834) KYUNGNAM WOOL TEXTILE CO., LTD(190111-0004107) BEXEL CORPORATION(176011-0028438) DAEWOO LIFE CO., LTD.(176011-0028595) CHOYANG CO., LTD. (130111-0009662) KUKDONG CO. LTD(200111-0075931) SAMRA ENGINEERING & CONSTRUCTION CO., LTD.(200111-0013220) SAMRA INDUSTRIAL DEVELOPMENT CO., LTD.(20111-0071319) SAMRA MIDAS CO., LTD.(200111-0069330) BULLWHUI CO., LTD. GIMPO CHARACTER WORLD CO., LTD.(124411-0050211) KOREA COMMUNICATION ENGINEERING CO., LTD.(110111-0204654) SMT CHEMICAL CO., LTD.(170111-0351776) TK CHEMICAL HOLDINGS CO., LTD.(170111-0352732)
Affiliates-Overseas	QINGDAO KYUNGNAM WOOL TEXTILE CO., LTD.(CHINA) BEST CHEMICALS & PLASTICS, INC.(BCPI) BESTCHEM, INC(BCI)
Overseas Office	TK CHEMICAL CORP. ISTANBUL OFFICE BESIKTAS LEVENT NISPETIYE CAD. NO.30 C BLOCK D.23 ISTANBUL, TURKIYE TEL:+90-212-3257861/3257862 FAX:+90-212+3258242
Liaison Office
Overseas Branch
Joint Venture
Subsidiary	HIPLUSCARD CO., LTD.(131111-0191187) (100.0% held by the subject company)
Corporate Ownership	SAMRA CONSTRUCTION CO., LTD.(200111-0013220) SMT CHEMICAL CO., LTD.(170111-0351776)
Major Shareholders	SMT CHEMICAL CO., LTD.(170111-0351776)
Cooperative Enterprise	-Insured Company HYUNDAIMARINE&FIREINSURANCECO., LTD.(110111-0035893)

Sales by Region (Activity & Markets)

Sales/ Unit :Mil KRW	09/2014	2013	2012
Export	368,325	618,568	699,301
Domestic	220,863	229,458	153,462
Total	589,188	848,026	852,763

The Subject exports to Asia, USA, Middle East and Europe.

Court Action

Case No.	Court	Plaintiff(s)/ Creditor(s)/ Applicant(s)	Defendant(s)/ Debtor(s)/ Respondent(s)	Cause	Amount (KRW)	Status
	Daegu District Court, Korea	HNL CO., LTD.(Korea)	The Subject Company	Fees	550,000,000	1^st round is proceeding.
	Supreme Court, Korea	The Subject Company	ASAM Investment Advisory(110111-1295850) & Others(4)	Refund of Stock Transferring amount	1,499,997,000	1st round is proceeding.

News Clipping

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FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.44
UK Pound	1	Rs.98.15
Euro	1	Rs.77.44

INFORMATION DETAILS

Analysis Done by :	RAS

Report Prepared by :	ANK

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.