MIRA INFORM REPORT

Report Date :

10.01.2014

IDENTIFICATION DETAILS

Name :	The United Laboratories (Inner MongolIa) Co., Ltd.
Registered Office :	No. 1 South Section, Fuyuan Road, Linhe Economic & Technology Park, Bayan Nur City, Inner Mongolia, 015000 PR
Country :	China
Financials (as on) :	30.06.2013
Date of Incorporation :	09.02.2007
Com. Reg. No.:	150000400000092
Legal Form :	Wholly Foreign Owned Enterprise
Line of Business :	Subject is engaged in producing and selling chemical medicine materials and preparations, antibiotic medicine materials and preparations and Chinese medicine preparations.
No. of Employees :	2,600

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 :	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)
China	A2	A2

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	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, creation of a diversified banking system, development of stock markets, rapid growth of the private sector, 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 it considers important to "economic security," explicitly looking to foster globally competitive national champions. After keeping its currency tightly linked to the US dollar for years, in July 2005 China revalued its currency by 2.1% against the US dollar and 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. 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 2012 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 demand; (b) sustaining adequate job growth for tens of millions of migrants and new entrants to the work force; (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. In 2010-11, China faced high inflation resulting largely from its credit-fueled stimulus program. Some tightening measures appear to have controlled inflation, but GDP growth consequently slowed to under 8% for 2012. An economic slowdown in Europe contributed to China's, and is expected to further drag Chinese growth in 2013. Debt overhang from the stimulus program, particularly among local governments, and a property price bubble challenge policy makers currently. The government's 12th Five-Year Plan, adopted in March 2011, emphasizes continued economic reforms and the need to increase domestic consumption in order to make the economy less dependent on exports in the future. However, China has made only marginal progress toward these rebalancing goals

Source : CIA

company name and address

The United Laboratories (Inner MongolIa) Co., Ltd.

NO. 1 SOUTH SECTION, FUYUAN ROAD, LINHE ECONOMIC & TECHNOLOGY PARK,

Bayan Nur CITY, Inner MongolIa, 015000 PR CHINA

TEL: 86 (0) 478-2266333

FAX: 86 (0) 478-2266985

EXECUTIVE SUMMARY

INCORPORATION DATE FEB. 9, 2007

REGISTRATION NO. : 150000400000092

REGISTERED LEGAL FORM : WHOLLY FOREIGN OWNED ENTERPRISE

CHIEF EXECUTIVE : MR. CAI haishan (CHAIRMAN)

STAFF STRENGTH : 2,600

REGISTERED CAPITAL : CNY 1,380,000,000

BUSINESS LINE : MANUFACTURING

TURNOVER : HKD 1,249,044,000 (JAN. 1 TO JUN. 30, 2013)

EQUITIES : HKD 1,985,492,000 (AS OF JUN. 30, 2013)

PAYMENT : AVERAGE

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : FAIRLY STABLE

OPERATIONAL TREND : FAIRLY STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : HKD 7.7533 = 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 Inner Mongolia Autonomous Region Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on Feb. 9, 2007.

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 production of raw material medicine, tablets, hard capsules, granules; the production of 6--APA, potassium clavulanate, new energy saving and environmental protection building materials; high-strength lightweight wall materials, high-grade environment-friendly decoration, decoration material, high quality waterproof sealing material, effective thermal insulation materials and products produced in domestic, international pharmaceutical business

SC is mainly engaged in producing and selling chemical medicine materials and preparations, antibiotic medicine materials and preparations and Chinese medicine preparations.

Mr. Cai Haishan is the legal representative and chairman of SC at present.

SC is known to have approx. 2,600 employees at present.

SC is currently operating at the above stated address, and this address houses its operating office and factory in the development zone of Bayan Nur City. Our checks reveal that SC owns the total premise about 280,000 square meters.

http://www.tul.com.cn/ The web belongs to The United Laboratories. The design is professional and the content is well organized. At present, it is both in Chinese and English versions.

Changes of its registered information are as follows:

Date	Item	Before the change	After the change
2007-9	Registered capital	CNY 50,000,000	CNY 160,000,000
	Registered no.	000998	Present one
2007-11	Registered capital	CNY 160,000,000	CNY 320,000,000
2009-5	Registered capital	CNY 320,000,000	CNY 480,000,000
2011-1	Registered capital	CNY 480,000,000	CNY 680,000,000
2011-9	Registered capital	CNY 680,000,000	Present amount
Unknown	Legal representative	Cai Jinle	Present one

There is no record of litigation till now. 

MAIN SHAREHOLDERS:

Name % of Shareholding

Bear World Limited (Hong Kong) 100

Registered number: 0537887

Incorporated date: Feb. 1, 1996

Legal form: Private

Legal Representative & Chairman:

Mr. Cai Haishan, Hong Kong people, ID# K665977(2), born in 1978 with the bachelor's degree. He is currently responsible for the overall management of SC.

Working Experience(s):

At present Working in SC as legal representative and chairman.

Also working in The United Laboratories International Holdings Limited as Chairman, in Zhongshan Jinyi Food Co., Ltd., United Laboratories (Chengdu) Co., Ltd., Zhuhai United Laboratories Co., Ltd., Zhuhai Lebang Pharmaceutical Co., Ltd., etc. as legal representative.

SC is mainly engaged in producing and selling chemical medicine materials and preparations, antibiotic medicine materials and preparations and Chinese medicine preparations.

SC’s products mainly include: chemical medicine materials and preparations, antibiotic medicine materials and preparations and Chinese medicine, etc.

SC sources its materials 99% from domestic market, and 1% from the overseas market, mainly European countries. SC sells 70% of its products in domestic market, and 30% to the overseas market, mainly Southeast Asia, American and European countries.

The buying terms of SC include Check, T/T, L/C and Credit of 30-60 days. The payment terms of SC include T/T, L/C and Credit of 30-60 days.

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

United Laboratories (Chengdu) Co., Ltd.

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

Registration no.: 510100400021487

Legal representative: Cai Haishan (蔡海山)

Registered capital: CNY 400,000,000

Date of incorporated: 2003-06-11

Zhuhai United Laboratories Co., Ltd.

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

Incorporation Date : Jul. 3, 1993

Registration No. : 440400400021954

Registered Legal Form : Shares Limited Company

Chief Executive : Mr. Cai Haishan (Chairman)

Registered Capital : CNY 1,142,496,000

Add: Sanzao Science & Technology Industry Park, National Hi-Tech Industrial Development Zone, Zhuhai, Guangdong Province, 519041 Pr China

Tel: 86 (0) 756-7787552

Fax: 86 (0) 756-7787988

E-mail: exp@tul.com.cn

Zhuhai Lebang Pharmaceutical Co., Ltd.

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

Registration no.: 440400400041118

Legal representative: Cai Haishan

Registered capital: HKD 12,000,000

Date of incorporated: 2001-12-24

Zhongshan Jinyi Food Co., Ltd.

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

Registration no.: 442000400026161

Legal representative: Cai Haishan

Registered capital: HKD 7,500,000

Date of incorporated: 1998-07-24

Etc.

Ultimate parent company:

The United Laboratories International Holdings Limited (Cayman Islands)

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

Date of incorporated: March 1, 2007

Legal form: Shares limited co.

Stock code: 03933

Listed in Hong Kong Stock Exchange Market

http://www.tul.com.cn/

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.

SC’s management declined to release its bank information.

Financial Summary

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

Unit: HKD’000

	As of Dec. 31, 2012	As of Jun. 30, 2013
Total liabilities	5,127,858	5,854,294
Equities	1,825,783	1,985,492
	--------------	--------------
Total liabilities & equities	6,953,641	7,839,786
	=========	=========
	As of Dec. 31, 2012	Jan. 1 to Jun. 30, 2013
Turnover	1,792,093	1,249,044
Profits	-78,379	-13,291

Note: SC’s management declined to release its financial information, and the above financial information comes from the first phase of short-term financing bonds prospectus of Year 2013 of Zhuhai United Laboratories Co., Ltd., and we did not find SC’s detailed financial reports.

Important Ratios

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

	As of Dec. 31, 2012	As of Jun. 30, 2013
*Liabilities to assets	0.74	0.75
*Net profit margin (%)	-4.37	-1.06
*Return on total assets (%)	-1.13	-0.17
*Turnover/Total assets	0.26	0.16

PROFITABILITY: FAIR

The turnover of SC appears fairly good in its line.

SC’s net profit margin is fair.

SC’s return on total assets is fair.

SC’s turnover is in a fair level, comparing with the size of its total assets.

LEVERAGE: AVERAGE

The debt ratio of SC is average

The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly stable.

SC is considered large-sized in its line with fairly stable financial conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.18
UK Pound	1	Rs.102.31
Euro	1	Rs.84.50

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.