MIRA INFORM REPORT

Report Date :

12.02.2014

IDENTIFICATION DETAILS

Name :	KAI CHING INDUSTRY CO., LTD.

Registered Office :	No.255, Ta Han Rd., Daliao Dist., Kaohsiung City 831,

Country :	Taiwan

Date of Incorporation :	08.02.1977

Com. Reg. No.:	81102914

Legal Form :	Joint Stock Company

Line of Business :	Manufacture and sale of steel

No. of Employees :	130

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 – September 30, 2013

Country Name

Previous Rating

(30.06.2013)

Current Rating

(30.09.2013)

Taiwan

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

TAIWAN - ECONOMIC OVERVIEW

Taiwan has a dynamic capitalist economy with gradually decreasing government guidance of investment and foreign trade. Exports, led by electronics, machinery, and petrochemicals have provided the primary impetus for economic development. This heavy dependence on exports exposes the economy to fluctuations in world demand. In 2009, Taiwan's GDP contracted 1.8%, due primarily to a 13.1% year-on-year decline in exports. In 2010 GDP grew 10.7%, as exports returned to the level of previous years, and in 2011, grew 4.0%. In 2012, however, growth fell to 1.3%, because of softening global demand. Taiwan's diplomatic isolation, low birth rate, and rapidly aging population are major long-term challenges. Free trade agreements have proliferated in East Asia over the past several years, but except for the landmark Economic Cooperation Framework Agreement (ECFA) signed with China in June 2010, so far Taiwan has been excluded from this greater economic integration in part because of its diplomatic status. Negotiations continue on such follow-on components of ECFA regarding trade in goods and services. The MA administration has said that the ECFA will serve as a stepping stone toward trade pacts with other key trade partners, which Taiwan subsequently launched with Singapore and New Zealand. Taiwan's Total Fertility rate of just over one child per woman is among the lowest in the world, raising the prospect of future labor shortages, falling domestic demand, and declining tax revenues. Taiwan's population is aging quickly, with the number of people over 65 accounting for 11.2% of the island's total population as of 2012. The island runs a large trade surplus largely because of its surplus with China, and its foreign reserves are the world's fifth largest, behind China, Japan, Saudi Arabia, and Russia. In 2006 China overtook the US to become Taiwan's second-largest source of imports after Japan. China is also the island's number one destination for foreign direct investment. Three financial memorandums of understanding, covering banking, securities, and insurance, took effect in mid-January 2010, opening the island to greater investments from the mainland's financial firms and institutional investors, and providing new opportunities for Taiwan financial firms to operate in China. In August 2012, Taiwan Central Bank signed a memorandum of understanding on cross-Strait currency settlement with its Chinese counterpart. The MOU allows for the direct settlement of Chinese RMB and the New Taiwan dollar across the Strait, which could help develop Taiwan into a local RMB hub. Closer economic links with the mainland bring greater opportunities for the Taiwan economy, but also poses new challenges as the island becomes more economically dependent on China while political differences remain unresolved

Source : CIA

Company name and address

Company Name:	KAI CHING INDUSTRY CO., LTD.
Supplied Name:	KAICHING INDUSTRY CO (LTD)
Trading Address:	No.255, Ta Han Rd., Daliao Dist., Kaohsiung City 831, Taiwan (R.O.C.)
Supplied Address:	HEAD OFFICE 255, DAHAN ROAD, DALIO DISTRICT KAOHSIUNG CITY, TAIWAN, R.O.C
Telephone Number:	+886- 7-702-3111
Fax Number:	+886 7-702-2535
E-mail:	export@kcico.com.tw

Notes: The exact name and address are as above.

Company Identification Details

Registered Name:	Kai Ching Industry Co., Ltd.
Registered Address:	No.255, Ta Han Rd., Daliao Dist., Kaohsiung City 831, Taiwan (R.O.C.)
Date of Foundation:	1977-2-8
Registration Number:	81102914
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 600,000,000 (USD 20,400,000) (As of 2014.01, 1 NTD = 0.0340 USD)
Paid-up Capital:	NTD 565,440,000 (USD 19,224,960)
Legal Representatives:	Sixin Zengchen
Legal Form:	Joint Stock Company
Principal Activities:	Manufacture and sale of steel, etc
Staff:	About 130 Employees
Listed at Stock Exchange:	No
Date of Last Annual Return:	2013-7-1

History

Subject was incorporated on 1977-2-8 with registered number 81102914 as Joint Stock Company in Taiwan.

Shareholders

Name	Subscription Shares
Sixin Zengchen	17,951,775
Zhenchang Chen
4,766,717
Chuanfeng Chen	5,283,827
Fuze Chen	5,250,977

The information above is that of subject’s major shareholders.

Subsidiaries & Branches

Factories

1
Name:	Kai Ching Industry Co., Ltd.
Address:	No.255, Ta Han Rd., Daliao Dist., Kaohsiung City 831, Taiwan (R.O.C.)
Date of Registration:	1979-9-15
Factory Registration Number:	99663339
Factory Manager:	Sixin Zengchen
Status:	In Production
Date of Last Annual Return:	2002-3-12
Major Products:	241 steel 242 aluminum 252 metal structure and architecture components
2
Name:	Kai Ching Industry Co., Ltd. Branch Plant
Address:	No.210, Mingui Rd., Daliao Dist., Kaohsiung City 831, Taiwan (R.O.C.)
Date of Foundation:	1990-12-31
Date of Registration:	1990-12-31
Factory Registration Number:	99663287
Factory Manager:	Sixin Zengchen
Status:	In Production
Date of Last Annual Return:	2002-3-12
Major Products:	241 steel 252 metal structure and architecture components
3
Name:	Kai Ching Industry Co., Ltd. Fengping Factory
Address:	No.177, Mingui Rd., Daliao Dist., Kaohsiung City 831, Taiwan (R.O.C.)
Date of Foundation:	1988-9-22
Date of Registration:	1993-5-18
Factory Registration Number:	99663286
Factory Manager:	Sixin Zengchen
Status:	In Production
Date of Last Annual Return:	2002-3-12
Major Products:	241 steel 254 metal processing 242 aluminum

Related Companies

1
Name:	Fujian Kaijing Steel Development Co., Ltd.
Address:	No.19 Jiaomei Industrial Zone, Longhai City, Fujian Province, China
Telephone Number:	+86-596-676-6251
Fax Number:	+86-596-676-6253
Principal Activities:	Manufacturing and sales of cold-rolling steel, galvanizing steel, color-coating steel
2
Name:	Zhongshan Kaifa Metal Co., Ltd.
Address:	No.32 Tanbei East 2^nd Avenue, Dongsheng Town, Zhongshan City, Guangdong Province, China
Telephone Number:	+86-760-850-0704
Fax Number:	+86-760-850-9966
Principal Activities:	Manufacturing and installation structure steel

Personnel Information

Core Management

Directors

1
Name	Sixin Zengchen
Position	Board Chairman
2
Name	Zhenchang Chen
Position	Director
3
Name	Chuanfeng Chen
Position	Director
4
Name	Fuze Chen
Position	Supervisor

Personnel Structure

Total Employees

About 130 Employees

Operation Information

Offices & Factories

	Headquarters
Add	No.255, Ta Han Rd., Daliao Dist., Kaohsiung City 831, Taiwan (R.O.C.)

Production Information

Subject is engaged in manufacturing steel products, etc.

It is introduced that subject’s Ta Han Road factory is about 19,500 square meters.

It is introduced that subject has four lines for production which are one continuous precoating line, one slitting line, two leveling and shearing lines.

The annual capacity of continuous precoating line is 90,000 MT.

Subject obtained certification of ISO 9001.

Purchase Information

The registered activities of subject:

Business Code	Details
E801020	Installation of windows and doors
CA01020	Rolling of steel
CA01050	Processing of steel secondary operation
CA04010	Treatment with metal surface
CA03010	Heat treatment of metal
CB01010	Manufacturing of mechanical equipment
F401010	International trade
CA01090	Casting of aluminum
C801010	Basic chemical trade
C802200	Manufacturing of coating, paint, dye and pigment
CA01990	Basic business of other nonferrous metal
CA02090	Manufacturing of metal wire
CA02990	Manufacturing of other metal products
CB01990	Manufacturing of other mechanical equipment
F211010	Retail of building materials
C901990	Manufacturing of other nonmetal mineral products
CA01060	Manufacturing of steel wire and wirerope
CA02010	Manufacturing of metal construction building component
CC01080	Manufacturing of electronic component
CD01030	Manufacturing of automobile and its parts
CD01040	Manufacturing of motor and its parts
F106010	Wholesale of ironware
F111090	Wholesale of building materials
F113010	Wholesale of machinery
F199990	Wholesale of other products
F206010	Retail of ironware
F213080	Retail of mechanical appliances
H701040	Development of specific professional area
H701060	Development of new town and new community
H701070	Agency service for levying section and redistricting district
ZZ99999	Besides licensed business, all other business items those are not banned or restricted.

The raw materials for production are mostly purchased in domestic market.

It is introduced that some production facilities are imported from Japan.

Sales Information

Subject is engaged in sale of steel products, etc.

The major products sold by subject include cold-rolled steel, galvanized steel, pre-painted steel, slitting and light section steel, etc.

Subject’s sales regions include Taiwan, Mainland China, Southeast Asia, Europe and America, etc.

One of subject’s major customers is Sumitomo Corporation.

Import and export right:

Import right	Yes
Export right	Yes

Settlements

Purchase

Domestic Purchase

Product	Terms	Proportion
Raw materials	Cash, T/T, etc	100%

Foreign Purchase

Product	Terms	Proportion
Facilities, etc	L/C, T/T, etc	100%

Sales

Domestic Markets

Product	Terms	Proportion
Steel products, etc	Cash, T/T, etc	100%

Export

Product	Terms	Proportion
Steel products, etc	L/C, T/T, etc	100%

Financial Information

Subject has no obligations to disclose its financial statements to the third party according to the relevant policy in Taiwan and the only source from which we can obtain the information is the subject itself.

Subject’s relevant staff Mr. Wang declined to disclose its financials citing the grounds of company’s confidentiality; from other source we can not obtain the relevant information, either.

Bankers

Subject declined to disclose its bank details; from other source we cannot obtain the relevant information, either.

Public Record

Mortgage

1
Case Type:	Chattel Mortgage
Certificate No.:	043503
Debtor Name:	Kai Ching Industry Co., Ltd.
Document Number:	392361
Date of Registration:	1993-10-21
Status:	Paid off
2
Case Type:	Chattel Mortgage
Certificate No.:	043980
Debtor Name:	Kai Ching Industry Co., Ltd.
Document Number:	393932
Date of Registration:	1993-12-21
Status:	Paid off
3
Case Type:	Chattel Mortgage
Certificate No.:	058985
Debtor Name:	Kai Ching Industry Co., Ltd.
Document Number:	828471
Date of Registration:	1998-8-17
Status:	Paid off

Lawsuit

Up to date of reporting, no existing or latent litigation of the subject has been found.

Interview Details

Name	Mr. Wang
Department	Sales Department

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.44
UK Pound	1	Rs.102.48
Euro	1	Rs.85.28

INFORMATION DETAILS

Report Prepared by :

NIS

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.