MIRA INFORM REPORT

Report Date :

31.07.2014

IDENTIFICATION DETAILS

Name :	LIPA PHARMACEUTICALS LTD
Formerly Known As :	LIPA PHARMACEUTICALS PTY LTD
Registered Office :	21 Reaghs Farm Road, Minto, New South Wales, Zip Code 2566
Country :	Australia
Financials (as on) :	31.12.2013 (Group Consolidated)
Date of Incorporation :	28.06.1995
Com. Reg. No.:	070106526
Legal Form :	Australian Non-Listed Public Company, Limited by Shares
Line of Business :	· engaged as contract manufacturer of complementary healthcare medicines, vitamins and nutritional supplements, with over 30% market share. Subject also manufactures a range of non-sterile prescription and over-the-counter medicines. Subject offers herbal medicines, vitamins, and nutritional supplements in the form of tablets, powders, hard-shells, liquids, creams, and soft gelatin capsules.
No of Employees :	1,619 employees (CK Life Sciences Group)

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 :	Good
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)
Australia	A1	A1

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

austraLia ECONOMIC OVERVIEW

The Australian economy has experienced continuous growth and features low unemployment, contained inflation, very low public debt, and a strong and stable financial system. By 2012, Australia had experienced more than 20 years of continued economic growth, averaging 3.5% a year. Demand for resources and energy from Asia and especially China has grown rapidly, creating a channel for resources investments and growth in commodity exports. The high Australian dollar has hurt the manufacturing sector, while the services sector is the largest part of the Australian economy, accounting for about 70% of GDP and 75% of jobs. Australia was comparatively unaffected by the global financial crisis as the banking system has remained strong and inflation is under control. Australia has benefited from a dramatic surge in its terms of trade in recent years, stemming from rising global commodity prices. Australia is a significant exporter of natural resources, energy, and food. Australia's abundant and diverse natural resources attract high levels of foreign investment and include extensive reserves of coal, iron, copper, gold, natural gas, uranium, and renewable energy sources. A series of major investments, such as the US$40 billion Gorgon Liquid Natural Gas project, will significantly expand the resources sector. Australia is an open market with minimal restrictions on imports of goods and services. The process of opening up has increased productivity, stimulated growth, and made the economy more flexible and dynamic. Australia plays an active role in the World Trade Organization, APEC, the G20, and other trade forums. Australia has bilateral free trade agreements (FTAs) with Chile, Malaysia, New Zealand, Singapore, Thailand, and the US, has a regional FTA with ASEAN and New Zealand, is negotiating agreements with China, India, Indonesia, Japan, and the Republic of Korea, as well as with its Pacific neighbors and the Gulf Cooperation Council countries, and is also working on the Trans-Pacific Partnership Agreement with Brunei Darussalam, Canada, Chile, Malaysia, Mexico, New Zealand, Peru, Singapore, the US, and Vietnam.

Source : CIA

CORPORATE DETAILS

Verified Address

Subject name LIPA PHARMACEUTICALS LTD Business address 21 Reaghs Farm Road Town Minto Province New South Wales Zip / Postal code 2566 Country Australia Telephone +61 2 87961400 Fax +61 2 87961440 Email sales@lipa.com.au Website www.lipa.com.au

Registered address 21 Reaghs Farm Road Town Minto Province New South Wales Zip / Postal code 2566 Country Australia Postal address P.O. Box 5981 Town Minto Province New South Wales Zip / Postal code 2566 Country Australia

SUMMARY DETAILS

Report Summary

Date registered 28/06/1995 Legal form Australian Non-Listed Public Company, Limited by Shares Key personnel Dusko Pejnovic Line of business The Subject’s business consist of contract manufacturing of complementary healthcare medicines and production of non-sterile prescription and over-the-counter medicines. Staff employed 1,619 employees (CK Life Sciences Group)

Paid-up capital AUD17,943,472.62 Sales turnover / Revenue / Income HKD4,970,927,000.00 (Group-Consolidated 12 months, 31/12/2013) Net income / loss HKD234,546,000.00 (Group-Consolidated 12 months, 31/12/2013) Total assets HKD10,219,778,000.00 (Group-Consolidated 12 months, 31/12/2013) Share equity HKD5,200,295,000.00 (Group-Consolidated 12 months, 31/12/2013)

CREDIT RISK OUTLOOK

Credit Risk Interpretation

Credit risk theory Sound financial and operational base for the group. Small to medium credits may be considered with confidence that the commitment will be sustained in almost all cases. This is based on criterions such as years of establishment, number of employees, sales turnover, profit after tax, total assets, reserve, and others. Normal credit control policy applies. Paid-up capital AUD17,943,472.62 Sales turnover / Revenue / Income HKD4,970,927,000.00 (Group-Consolidated 12 months, 31/12/2013) Net income / loss HKD234,546,000.00 (Group-Consolidated 12 months, 31/12/2013) Total assets HKD10,219,778,000.00 (Group-Consolidated 12 months, 31/12/2013) Share equity HKD5,200,295,000.00 (Group-Consolidated 12 months, 31/12/2013)

Subject’s Credit Risk Analysis

Country risk Country risk is minimal Operation trend Operational trend is progressing Management experience Management is reasonably experienced Financial performance Group financial performance is very good Remarks Larger credit can still be considered as the Subject's is well positioned in the market and the financial stability of the group is positive.

Organisation structure Organisational structure is consistent Detrimental No detrimental found Payment history No payment delays noted

STATUTORY DETAILS

Registry Information

Date registered 28/06/1995 Legal form Australian Non-Listed Public Company, Limited by Shares Registration number Australian Company Number: 070106526 Registered authority Australian Securities and Investments Commission Tax / VAT number Australian Business Number: 21070106526

Statutory status Active Previous name LIPA PHARMACEUTICALS PTY LTD (initial) Change of legal form None reported.

BOARD OF MANAGEMENT

Key Personnel

Name Dusko Pejnovic Designation Chief Executive Officer

BOARD OF DIRECTORS

Appointments

Name John David Cambridge Title Director Appointment date 06/11/07 Address '40A', 188 Carrington Street Adelaide, SA 5000 Australia Biography Born on 12/04/1944 in Adelaide, South Australia, Australia. Name Jerry Yiu Leung Mo Title Director Appointment date 06/11/07 Address 33 Ho Chung New Village Sai Kung, New Territories Hong Kong Biography Born on 14/04/1959 in Hong Kong. Name Nick Bolkus Title Director Appointment date 06/11/07 Address 401 Esplanade Henley Beach, SA 5022 Australia Biography Born on 17/07/1950 in Adelaide, South Australia, Australia. Name Leon Hing Chau Lam Title Director Appointment date 01/06/14 Address 3 Cedar Close MacKenzie, QLD 4156 Australia Biography Born on 10/02/1958 in Hong Kong. Name Alan Abel Ying Choi Yu Title Director Appointment date 06/11/07 Address Flat A, 14/F., Block 2, Clovelly Court 12 May Road Mid-Levels Central Hong Kong Biography Born on 06/05/1955 in Hong Kong. Name David Ronald Zwi Title Company Secretary Appointment date 06/11/07 Address 37 Stanley Street Saint Ives, NSW 2075 Australia Biography Born on 21/07/1954 in South Africa.

Staff employed 1,619 employees (CK Life Sciences Group)

Other Appointments

Auditor DELOITTE TOUCHE TOHMATSU Eclipse Tower 60 Station Street Parramatta, NSW 2150 Australia

SHARE CAPITAL

Composition

Authorized capital AUD17,943,472.62 Number / Type of shares 95,573,284 Ordinary Shares Share par value No par value Issued capital AUD17,943,472.62

Paid-up capital AUD17,943,472.62

OWNERSHIP / SHAREHOLDERS

Composition

How listed Full list Shareholder name CK LIFE SCIENCES INT’L., (HOLDINGS) INC. Address 2 Dai Fu Street Tai Po Industrial Estate Tai Po Hong Kong Number / Type of shares 95,573,284 Ordinary Shares Percentage (%) of shares 100%

CORPORATE AFFILIATIONS AND RELATED COMPANIES

Structure

Company name CK LIFE SCIENCES INT’L., (HOLDINGS) INC. Affiliation type Parent Company Country of business Hong Kong Comments The company is registered in Cayman Islands. CK Life Sciences Int'l., (Holdings) Inc., an investment holding company, is engaged in the research and development, manufacture, commercialization, marketing, and sale of health and agriculture-related products in the Asia Pacific and North America. It manufactures and markets plant protection products and soluble fertilizers; manufactures, blends, distributes, and sells fertilizers, pesticides, and related agricultural products; manufactures and distributes horticultural products; and contract manufactures complementary healthcare medicines and produces non-sterile prescription and over-the-counter medicines. The company is also involved in licensing registration activities and the importation of finished agricultural goods; holding land and building; financing, water treatment, and trustee activities; investment in financial instruments, as well as vineyards and wineries; trading biotechnology products and nutritional supplements; and the manufacture, wholesale, retail, and distribution of nutraceutical products. In addition, it distributes turf management machinery, hardware, equipment, and accessories, as well as chemicals and professional pest products; produces, refines, and distributes salt products; and provides services in the research and development of bio-technology and life sciences technology products. CK Life Sciences’ products include emulsifiable concentrates, suspension concentrates, aqueous solutions, coated granules, powders, and amination based reactions for crop protection; and pharmaceutical products, such as Tetrodotoxin and POL-103A that are in advanced stages of clinical development, as well as CKBP002 and CKBP004 that are in pre-clinical studies for the treatment of cancer. The company is headquartered in Tai Po, Hong Kong. Company name ACCENSI PTY LTD Affiliation type Sister Company Country of business Australia Company name BARMAC PTY LTD Affiliation type Sister Company Country of business Australia Company name AMGROW PTY LTD Affiliation type Sister Company Country of business Australia Company name CK BIOTECH LABORATORY LIMITED Affiliation type Sister Company Country of business Hong Kong Company name CK LIFE SCIENCES LIMITED Affiliation type Sister Company Country of business Hong Kong Company name NANJING GREEN VENTURE ECOSCIENCES INC. Affiliation type Sister Company Country of business China Company name NANJING GREEN VISION ECOSCIENCES INC. Affiliation type Sister Company Country of business China Company name WEX PHARMACEUTICALS INC. Affiliation type Sister Company Country of business Canada Company name VITAQUEST INTERNATIONAL HOLDINGS LLC Affiliation type Sister Company Country of business United States

Remarks on corporate affiliations and related companies Other companies of the CK Life Sciences group should be considered affiliates of the Subject.

BANK AND MORTGAGES

Bank Details

Name of bank National Australia Bank Limited Address Australia Name of bank Commonwealth Bank of Australia Address Australia

Comments It is generally not the policy of local banks to provide credit status information to non related parties, however interested parties would be advised to consult first with the Subject if banker's references are required.

Mortgages

None reported.

Legal Filings

Bankruptcy filings None reported. Court judgements None reported.

Tax liens None reported. Others None reported.

FINANCIAL STATISTICS

Description

Financial statement source Public Record Sources Financial statement date 31/12/13 Style of financial statement Full audited

Currency of financial statement Hong Kong, Dollar (HKD) Exchange rate 1 USD = HKD 7.75 as of 31-07-2014

Concise Financial Data	Consolidation style	Group Consolidated	Group Consolidated
	Currency	Hong Kong, Dollar (HKD)	Hong Kong, Dollar (HKD)
	Date of financial year end	31/12/13	31/12/12
	Length of financial accounts	12 months	12 months
	Sales turnover / Revenue / Income	4,970,927,000.00	4,545,022,000.00
	Gross profit	1,741,814,000.00	1,552,806,000.00
	Profit / Loss before tax	303,729,000.00	301,013,000.00
	Net income / loss	234,546,000.00	198,034,000.00
	Non-current assets	7,332,998,000.00	6,870,090,000.00
	Property, plant and equipment	1,177,459,000.00	561,604,000.00
	Current assets	2,886,780,000.00	2,429,873,000.00
	Inventories	952,912,000.00	796,031,000.00
	Cash and cash equivalents	767,661,000.00	572,113,000.00
	Accounts receivable	1,036,987,000.00	983,733,000.00
	Total assets	10,219,778,000.00	9,299,963,000.00
	Current liabilities	2,215,741,000.00	1,178,104,000.00
	Non-current liabilities	2,803,742,000.00	2,398,161,000.00
	Accounts payable	1,089,290,000.00	923,122,000.00
	Total liabilities	5,019,483,000.00	3,576,265,000.00
	Share equity	5,200,295,000.00	5,723,698,000.00

Remarks

The group consolidated financial statement above relates to the Subject's Parent Company CK Life Sciences Int’l., (Holdings) Inc. and all its subsidiaries.

BUSINESS DETAILS

Operational Details

Main activities The Subject engages as contract manufacturer of complementary healthcare medicines, vitamins and nutritional supplements, with over 30% market share. In addition, the company also manufactures a range of non-sterile prescription and over-the-counter medicines. The Subject offers herbal medicines, vitamins, and nutritional supplements in the form of tablets, powders, hard-shells, liquids, creams, and soft gelatin capsules.

Purchases

Local The Subject sources its product(s) / material(s) locally.

International The Subject sources its product(s) / material(s) from countries in Asia, Europe, United States.

Sales

Local The Subject sells its product(s) locally.

International The Subject exports its product(s) to countries worldwide.

Business Facilities and Assets

Premises The Subject operates from the verified heading address consisting of a production facility, warehouse and an administrative office.

Branches In addition, the Subject operates from a production facility located in Victoria, Australia.

sUMMARIZED COUNTRY RISK

Gross Domestic Products (GDP) and Economic Overview

Central bank Reserve Bank of Australia Reserve of foreign exchange and gold US$ 46.714 billion Gross domestic product (GDP) US$ 1.586 trillion Purchasing power parity (GPP) 954.296 billion of International dollars GDP per capita (current prices) US$ 68,916 GDP composition by sector agriculture: 4% industry: 25.6% services: 70.4% Inflation 2010: 2.8% 2011: 3.4% 2012: 2.7% Unemployment rate 2010: 5.2% 2011: 5.1% 2012: 5.2%

Public debt (general Government gross debt as percentage (%) of GDP) 2010: 20.4% 2011: 22.9% 2012: 24% Government bond ratings Standard & Poors: AAA Moodys rating: Aaa Moodys outlook: STA Market value of publicly traded shares US$1.198 trillion Largest companies Qantas Airways (Airline),Coca-Cola Amatil (Beverages), CSL (Biotechs), Brambles (Business & Personal Services),Crown Ltd (Casinos & Gaming), Amcor (Containers & Packaging),Suncorp-Metway (Diversified Insurance), BHP Billiton (Diversified Metals & Mining),Newcrest Mining (Diversified Metals & Mining), Orica (Diversified Metals & Mining), Iluka Resources (Diversified Metals & Mining), Origin Energy (Electric Utilities), AGL Energy (Electric Utilities), Wesfarmers (Food Retail), Woolworths (Food Retail), Metcash (Food Retail), Macquarie Group (Investment services), AMP (Investment services), Challenger Ltd (Investment services), Fortescue Metals Group (Iron & Steel), Bluescope Steel (Iron & Steel), Commonwealth Bank (Major Banks), Westpac Banking Group (Major Banks), National Australia Bank (Major Banks), ANZ (Major Banks), Woodside Petroleum (Oil & Gas Operations), Santos (Oil & Gas Operations), Caltex Australia (Oil & Gas Operations), WorleyParsons (Oil Services & Equipment), Toll Holdings (Other Transportation), Transurban Group (Other Transportation), QBE Insurance Group (Property & Casualty Insurance), Insurance Australia Group (Property & Casualty Insurance), QR National (Railroads), Westfield Group (Real Estate), Stockland Australia (Real Estate), Westfield Retail Trust (Real Estate), Lend Lease (Real Estate), CFS Retail Property Trust (Real Estate), Goodman Group (Real Estate), Bendigo & Adelaide Bank (Regional Banks), Bank of Queensland (Regional Banks), Incitec Pivot (Specialized Chemicals), Telstra (Telecommunications Services)

Trade and Competitiveness Overview

Total exports US$263.9 billion Export commodities Coal, iron ore, gold, meat, wool, alumina, wheat, machinery and transport equipment Total imports US$239.7 billion Import commodities Machinery and transport equipment, computers and office machines, telecommunication equipment and parts; crude oil and petroleum products Best countries for doing business 10 out of 185 countries Global competitiveness ranking 20 (ranking by country on a basis of 144, the first is the best)

Major export partners China 27.4%, Japan 19.2%, South Korea 8.9%, India 5.8% Major import partners China 18.5%, US 11.4%, Japan 7.9%, Singapore 6.3%, Germany 4.7% FDI inflows 2009: US$26,554 million 2010: US$35,556 million 2011: US$41,317 million FDI outflows 2009: US$16,693 million 2010: US$12,791 million 2011: US$19,999 million

Country and Population Overview

Total population 22.68 million Total area 7,692,024 km2 Capital Canberra

Currency Australian dollars (AUD) Internet users as percentage (%) of total population 79%

PAYMENT OUTLOOK

Purchases Term

Local Bank transfer, D/P, Credit 30-120 days

International L/C, Prepayment, Telegraphic transfer, D/P, Credit 30-120 days

Sales Term

Local Bank transfer, D/P, Credit 30-120 days

International L/C, Prepayment, Telegraphic transfer, D/P, Credit 30-120 days

Trade Reference / Payment Behaviour

Comments As local and international trade references were not supplied, the Subject's payment track record history cannot be appropriately determined but based on our research, payments are believed to be met without delay.

Investigation Note

Sources Interviews and material provided by the Subject Other official and local business sources

Attachments

Attachments Group consolidated financial statements List of affiliated companies

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.60.15
UK Pound	1	Rs.101.92
Euro	1	Rs.80.64

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%)

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.