MIRA INFORM REPORT

Report Date :

06.05.2014

IDENTIFICATION DETAILS

Name :	JIANGSU SHENGHONG SCIENCE AND TECHNOLOGY CORPORATION LIMITED
Registered Office :	Shengze Textile Technology Park, Wujiang City Jiangsu Province 215228 Pr
Country :	China
Date of Incorporation :	31.12.2002
Com. Reg. No.:	320000400000671
Legal Form :	Share Limited Company
Line of Business :	Subject is engaged in manufacturing and selling polyester fiber, yarn, other recycled plastics, and chemical fabrics.
No. of Employees	6,630

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 :	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 – March 31, 2014

Country Name	Previous Rating (31.12.2013)	Current Rating (31.03.2014)
China	A2	A2

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

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, growth of the private sector, development of stock markets and a modern banking system, 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 considered important to "economic security," explicitly looking to foster globally competitive industries. After keeping its currency tightly linked to the US dollar for years, in July 2005 China 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 and expanded the daily trading band within which the RMB is permitted to fluctuate. 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 2013 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 consumption; (b) facilitating higher-wage job opportunities for the aspiring middle class, including rural migrants and increasing numbers of college graduates; (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. Several factors are converging to slow China's growth, including debt overhang from its credit-fueled stimulus program, industrial overcapacity, inefficient allocation of capital by state-owned banks, and the slow recovery of China's trading partners. The government's 12th Five-Year Plan, adopted in March 2011 and reiterated at the Communist Party's "Third Plenum" meeting in November 2013, emphasizes continued economic reforms and the need to increase domestic consumption in order to make the economy less dependent in the future on fixed investments, exports, and heavy industry. However, China has made only marginal progress toward these rebalancing goals. The new government of President XI Jinping has signaled a greater willingness to undertake reforms that focus on China's long-term economic health, including giving the market a more decisive role in allocating resources

Source : CIA

Company name and address

JIANGSU SHENGHONG SCIENCE AND TECHNOLOGY CORPORATION LIMITED

SHENGZE TEXTILE TECHNOLOGY PARK, WUJIANG CITY

JIANGSU PROVINCE 215228 PR CHINA

TEL: 86 (0) 512-63578066/63517818

FAX: 86 (0) 512-63517309

EXECUTIVE SUMMARY

DATE OF REGISTRATION : DECEMBER 31, 2002

REGISTRATION NO. : 320000400000671

LEGAL FORM : SHARE LIMITED COMPANY

CHIEF EXECUTIVE : MIAO HAN’GEN (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : CNY 2,992,741,122

staff : 6,630

BUSINESS CATEGORY : MANUFACTURING & trading

REVENUE : N/A

EQUITIES : n/a

WEBSITE : www.shenghongtec.com

E-MAIL : sh@shenghongcf.com

PAYMENT : AVERAGE

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : n/a

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.25 = USD 1

Adopted abbreviations (as follows)

SC - Subject Company (the company inquired by you)

N/A – Not available

CNY – China Yuan Ren Min Bi

OPERATIONAL TREND & GENERAL REPUTATION

This section aims at indicating the relative positions of SC in respect of its operational trend & general reputation

Operational Trend:- General Reputation:-

Upward Excellent

Steady Good

Fairly Steady Fairly Good

Ordinary Average

Fair Fair

Stagnant Detrimental

Downward Not known

Not known Not yet be determined

Not yet be determined

LEGAL STATUS & HISTORY

SC was established as a Chinese-foreign equity joint venture enterprise of PRC on December 31, 2002. However, SC changed to present legal form, and was registered as share limited company of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 320000400000671 in October of 2011.

SC’s Organization Code Certificate No.: 74481045-2

SC’s Tax No.: 320584744810452

SC’s registered capital: CNY 2,992,741,122

SC’s paid-in capital: CNY 2,992,741,122

Registration Change Record:-

Date	Change of Contents	Before the change	After the change
2007-2	Registered Capital	USD 25,000,000	USD 115,000,000
2008-3	Registered Capital	USD 115,000,000	USD 148,000,000
2008-11	Registered Capital	USD 148,000,000	USD 181,000,000
2009-6	Registered Capital	USD 181,000,000	USD 207,500,000
2009-9	Registered Capital	USD 207,500,000	USD 240,500,000
2010-4	Registered Capital	USD 240,500,000	USD 274,500,000
2011-8	Shareholder (s) (% of Shareholding)	Shenghong Group Company Limited 75% (Hong Kong) Best Holding Group Co., Limited 25%	Jiangsu Shenghong Investment Co., Ltd. 75% (Hong Kong) Best Holding Group Co., Limited 25%
2011-10	Registered Capital	USD 274,500,000	CNY 2,160,000,000
	Company name	Jiangsu Shenghong Chemical Fiber Co., Ltd.	Jiangsu Shenghong Science And Technology Corporation Limited
	Legal Form	Chinese-Foreign Equity Joint Venture Enterprise	Share Limited Company
--	Registration No.	000272	231100400000861
	Registered Capital	CNY 2,160,000,000	CNY 2,992,741,122
	Shareholder	Jiangsu Shenghong Investment Co., Ltd.	Jiangsu Shenghong Petrochemical Group Co., Ltd.

Current Co search indicates SC’s shareholders & chief executives are as follows:-

Name of Shareholder (s)	% of Shareholding
Jiangsu Shenghong Petrochemical Group Co., Ltd.	75
(Hong Kong) Best Holding Group Co., Limited	25

SC’s Chief Executives:-

Position	Name
Legal Representative, Chairman, and General Manager	Miao Han’gen
Vice Chairman	Tang Jinkui
Director	Zhang Yexing
	Zhu Xiaowei
	Zhu Hongmei
	Zhu Junying
	Zhao Xudong
	Wang Yuping
	Chen Hanwen
Supervisor	Meng Weiyuan
	Jing Daoquan
	Shen Xueliang

RECENT DEVELOPMENT

SC has passed Quality Management System Certificate and ISO 14001 Certificate. SC’s several products, such as DTY 150D/288F, SCHOOL, FDY75D/36F flat filament have gained the provincial certification. SC also won the title of “AAA Grade Credit Enterprise” and “Wujiang Top 100 Enterprises”, and etc.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

Jiangsu Shenghong Petrochemical Group Co., Ltd. 75

(Hong Kong) Best Holding Group Co., Limited 25

Jiangsu Shenghong Petrochemical Group Co., Ltd.

--------------------------------------------

Date of Registration: August 1, 2011

Registration No.: 320584000301154

Chief Executive: Miao Han’gen

Registered Capital: CNY 2,000,000,000

(Hong Kong) Best Holding Group Co., Limited

-------------------------------

Registration No.: 1273300

Legal Form: Private

MANAGEMENT

Miao Han’gen Legal Representative, Chairman and General Manager

------------------------------------------------------------------------------------------------------

Gender: M

Age: 49

ID# 320525196508205610

Qualification: University

Working experience (s):

From 1986 to 1990, worked in Shenghong Silk Factory as vice factory manager

From 1991 to 1992, worked in Shenghong Silk Factory as factory manager

From 1993 to 1996, worked in Shenghong Printing Factory as factory manager

From 1997 to present, working in Shenghong Group Company Limited as legal representative and chairman

At present, working in SC as legal representative, chairman and general manager, also working in Wujiang Shenghong Investment Development Company Limited, Jiangsu Shenghong Environmental Fiber Co., Ltd., Shenghong Group Co., Ltd., Wujiang Jiayu Industrial Development Co., Ltd., Jiangsu Guowang Hi-Tech Fiber Co., Ltd., Jiangsu Zhonglu Science and Technology Development Co., Ltd., Jiangsu Shenghong Investment Co., Ltd., Jiangsu Honggang Petrochemical Co., Ltd., Jiangsu Sierbang Petrochemical Co., Ltd., and Lianyungang Xinrongtai Terminal Co., Ltd. as legal representative

Tang Jinkui Vice Chairman

-------------------------------------------------

Gender: M

Age: 59

ID# 320525195509195616

Qualification: University

Working experience (s):

At present, working in SC as vice chairman

Director

-----------

Zhang Yexing ID# 32052519710618353X

Zhu Xiaowei ID# 320525197006286814

Zhu Hongmei ID# 320525196308125667

Zhu Junying ID# 41012619720114077X

Zhao Xudong ID# 110108195909296339

Wang Yuping ID# 110105196301130125

Chen Hanwen ID# 350203196801244070

Supervisor

--------------

Meng Weiyuan ID# 320525197304212610

Jing Daoquan ID# 342225197908150595

Shen Xueliang ID# 320525197004215318

BUSINESS OPERATION

SC’s registered business scope includes general business scope: R & D , manufacturing different chemical fiber; selling chemical products and materials (hazardous chemicals and precursor chemicals); wholesaling machinery and equipment, commission agents(excluding auction) and international trade.

SC is mainly engaged in manufacturing and selling polyester fiber, yarn, other recycled plastics, and chemical fabrics.

SC’s products mainly include: polyester chip, POY, DTY, FDY, SCHOOL, special fiber.

SC sources its materials 90% from domestic market, and 10% from overseas market, mainly South Korea, European countries, etc. SC sells 10% of its products to overseas market, mainly Pakistan, Vietnam, Bangladesh, etc., and 90% in domestic market.

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

*Major Customers:

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

C S America Inc.

Chori America Inc.

Staff & Office:

--------------------------

SC is known to have approx. 6,630 staff at present.

SC owns an area as its operating office & factory of approx. 960,000 sq. meters at the heading address.

RELATED COMPANY

Shenghong Group Company Limited

Wujiang Shenghong Hotel Holdings Company Limited

Wujiang Pengxiang Estate Development Company Limited

Jiangsu Shenghong Environmental Fiber Co., Ltd.

Etc.

PAYMENT

Overall payment appraisal:

( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet be 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.

BANKING

The bank information of SC is not filed in SAIC.

FINANCIALS

The financials of SC is not available in local SAIC, and SC also refused to release the details.

CONCLUSIONS

SC is considered large-sized in its line with a development history of 12 years. Credit up to moderate amount may be considered.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.60.05
UK Pound	1	Rs.101.32
Euro	1	Rs.83.34

INFORMATION DETAILS

Analysis Done by :	RAS
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.