MIRA INFORM REPORT

Report Date :

29.11.2014

IDENTIFICATION DETAILS

Name :	HANSOL CHEMICAL CO., LTD.

Registered Office :	310, Ogeum-ro, Songpa-gu, Seoul, Korea, 8th Fl., Jungang Daily News Bldg., 138-716

Country :	South Korea

Financials (as on) :	30.09.2014

Date of Incorporation :	13.03.1980

Com. Reg. No.:	102-81-34955

Legal Form :	Listed Company

Line of Business :	Manufacture of Other Basic Inorganic Chemicals like Hydrogen Peroxide, Latex, Benzoyl Peroxide, Sodium Hydrosulphite, Adhesives for Paper, Adhesives for Wood, Fixing Agent, Wet Strength Agent, Retention Aid, Alkaline Sizing Agent, Chelating Agent, Micro Capsule, Insolubilizer, Urea Formaldehyde, Benzoyl Peroxide, Pharmaceutical Fine Chemical

No of Employees :	369

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 – June 1, 2014

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

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

Basic Information

Company Name	HANSOL CHEMICAL CO., LTD. (Korean Company Name : “(주)한솔케미칼”)
Registered Address	310, Ogeum-ro, Songpa-gu, Seoul, Korea
Building	8th Fl., Jungang Daily News Bldg.
Zip Code	138-716
Tel	+82-2-2152-2399
Fax	+82-2-2152-2391~2
E-mail	jerry@hansol.co.kr;rodjang@hansol.com;chan@hansol.com;chan@hansol.com
Website	www.hansolchemical.com
Trading Address	8th Fl., Jungang Daily News Bldg., 310, Ogeum-ro, Songpa-gu, Seoul, Korea (Old Address System : 8th Fl., Jungang Daily News Bldg., 8-2, Garakbon-dong, Songpa-gu, Seoul, Korea)
Tel	+82-2-2152-2399
Fax	+82-2-2152-2391~2
Other Address-Ulsan Factory	231, Yeocheon-dong, Nam-gu, Ulsan, Korea
Tel	+82-52-259-8000
Fax	+82-52-267-2644
Other Address-Jeonju Factory	816, Yongam-ri, Bongdong-eup, Wanju-gun, Jeollabuk-do 565-900 Korea
Tel	+82-63-260-8114
Fax	+82-263-261-7237
Type	Export/Import
Industry	Manufacture of Other Basic Inorganic Chemicals
Main Business	Hydrogen Peroxide, Latex, Benzoyl Peroxide, Sodium Hydrosulphite, Adhesives for Paper, Adhesives for Wood, Fixing Agent, Wet Strength Agent, Retention Aid, Alkaline Sizing Agent, Chelating Agent, Micro Capsule, Insolubilizer, Urea Formaldehyde, Benzoyl Peroxide, Pharmaceutical Fine Chemical
Sub Business
Established (mm/dd/yyyy)	03/13/1980

The Subject owns the premises of Ulsan Factory and Jeonju Factory.

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Resins(13111000)
Sell	Films(13111200)
Sell	TMP(Trimethylol propane)
Sell	Benzoyl peroxide(51101525)
Sell	Urea formaldehyde(13111027)
Sell	Curing agents(12162300)
Sell	Bleaches(47131807)
Sell	Inorganic peroxides(12352304)
Sell	Latex rubber(13101501)

CEO’s

Name	Park Won-Hwan
Address
Date of Birth	05/08/1954
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

56,475,975,000

Employees

369

Formation

Listed Company (Korea Stock Exchange : 014680) as of 05/20/1989

A Company of Hansol Group

Bank Details

Woori Bank-Teheranro Branch

Nonghyup Bank

Kookmin Bank

Corporate Registered No.

110111-0270895

Business Registered No.

102-81-34955

Permit & Licenses

01/1989 KS

11/09/2005 ISO 9001

11/09/2005 ISO 14001

Int’l Trade No.: 802923

Shareholder Position

Name	Shares	%
CHO DONG-HYUCK	1,619,448	14.34
KB ASSET MANAGEMENT CO., LTD.(110111-0572556)	1,806,002	15.99
ALLIANZ GLOBAL INVESTORS KOREA LIMITED (110111-2124347)	1,630,720	14.44
NATIONAL PENSION SERVICE(110171-0007134)	1,531,521	13.56
CHO DONG-KIL	35,479	0.31
HANSOL LOGISTICS CO., LTD.(110111-0150659)	360,573	3.19
OTHERS	4,311,452	38.17
TOTAL	11,295,195	100.00

Company History

03/1980 Incorporated as Korea Peroxide Co., Ltd.

12/1985 Renamed company to Youngwoo chemical Co., Ltd

05/1989 Listed on the Korean Stock Exchange Market

05/1994 Affiliated to Hansol conglomerate

12/1995 Renamed company to Hansol Chemical Co., Ltd.

01/2000 Renamed company to Hansol Chemience Co., Ltd.

01/2000 Established Pharmaceutical Fine Chemical R&D center

02/2001 Expanded THP factory)

09/2001 Expanded SB-LATEX factory

10/2001 Expanded new regeneration process of hydrogen peroxide factory

04/2002 Consecutive 3,340days accident-free operation in Jeonju, Ulsan plant

10/2002 Established joint venture on ink cartridge factory in China

04/2003 Designated Bulk Good Manufacturing Practice awarding Korea Food & Drug Administration

06/2003 Established joint venture of Trimethylolpropane business with Perstorp

09/2003 Designated new labor-management culture awarding Ministry of Labor in Chonju plant

10/2003 Completed joint venture factory of ink cartridge in China

03/2004 Renamed company to Hansol Chemical Co., Ltd.

06/2004 Acquired INNOPTIX Co., Ltd.

09/2004 Received the Minister's Award from Ministry of Commerce, Industry and Energy for productivity improvement in Ulsan Plant

04/2005 Expanded half pure Hydrogen Peroxide plant in Ulsan

09/2006 Consecutive 5520 days accident-free operation in Ulsan plant

12/2007 Acquired C&P Chemical Co.,Ltd

12/2008 Update the Credit Rating (BBB0 → BBB+)

02/2009 Moved to the present HQ address from 18FL., Hansol Bldg., 736-1, Yeoksam 1-dong, Gangnam-gu, Seoul, Korea

Detailed Information

Management

Job Description	Title	Name	Nationality	Date of Birth	Education
President & CEO	Mr.	Park Won-Hwan	Korean	1954.05.08	Hanyang University, Korea
Director	Mr.	Cho Dong-Hyuck	Korean	1950.11.22	MIDDLEBURY University
Director	Mr.	Kim Hwa-Joo	Korean	1964.06.	Kyungbuk National University, Korea
Outside Director / Auditor	Mr.	Seo Jung-Ho	Korean	1969.08.	Seoul National University, Korea
Outside Director / Auditor	Mr.	Cho Nam-Shin	Korean	1955.06.	University of Pennsylvania, Wharton School
Outside Director / Auditor	Mr.	Choi Jong-Yeon	Korean	1955.03.	Univ. of Pittsburgh, USA

Financials

Year / Unit : KRW	Sales	Assets	Net Income
(*)09/2014	205,355,003,544	367,656,234,947	15,611,219,946
(*)2013	286,157,034,520	344,585,590,175	21,039,693,711
(*)2012	293,809,915,235	329,487,453,499	31,162,345,055
(*)2011	278,623,403,000	304,880,910,000	13,311,992,000
(*)2010	228,250,587,000	252,155,500,000	14,130,749,000
2009	192,376,780,000	199,337,702,000	16,959,424,000
2008	190,168,994,000	180,507,244,000	3,159,769,000
2007	157,934,388,723	190,563,710,819	5,286,916,106
2006	154,626,000,938	187,921,821,032	11,338,886,237
2005	164,774,204,000	199,920,288,000	12,303,753,000
2004	161,892,863,000	193,123,644,000	10,060,139,000

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

Financial Description

Authorized Capital(KRW)	150,000,000,000
Paid-Up Capital(KRW)	56,475,975,000
Total Issues Shares	11,295,195

Balance Sheet
Unit : Korean Won	01/01/2014~09/30/2014	As of 12/31/2013	As of 12/31/2012
Total Assets	367,656,234,947	344,585,590,175	329,487,453,499
Current Assets	77,204,012,209	63,779,621,038	82,606,792,975
Cash & Cash Equivalents	4,686,115,564	1,057,430,996	11,601,831,028
Trade Receivables & Other Receivables	47,510,913,026	43,388,604,227	52,270,720,498
Inventories	19,922,599,136	19,137,589,933	17,578,301,638
Deferred Income Tax Assets	15,711,020
Current Financial Instruments	2,084,703,045	4,727,891	4,727,891
Other Current Assets	2,983,970,418	191,267,991	1,151,211,920
Non-Current Assets	290,452,222,738	280,805,969,137	246,880,660,524
Non-Current Financial Instruments	26,000,000	26,000,000	26,000,000
Long-Term Trade Receivables & Other Receivables	11,880,840,183	12,257,086,081	9,600,374,974
Marketable Financial Instruments	12,319,726,977	12,966,880,242	10,613,826,302
Investment_Subsidiaries	34,596,524,000	34,596,524,000	12,484,364,000
Investment_Related Companies	16,338,364,496	16,338,364,496	16,338,364,496
Tangibles	201,653,416,821	188,015,653,073	183,558,100,189
Intangibles	13,190,502,574	14,078,391,832	11,930,670,584
Other Financial Assets	446,847,687	2,527,069,413	2,328,959,979
Total Liabilities	170,303,778,381	156,818,514,722	159,759,534,057
Current Liabilities	61,844,749,094	88,844,263,769	65,721,461,964
Trade Payables & Other Payables	44,415,231,061	43,713,678,397	41,451,602,685
Short-Term Borrowings	3,820,298,324	2,046,347,532	11,203,427,978
Current Portion of Long-Term Debts	10,000,000,000		5,000,000,000
Deferred Income Tax Credit	2,744,927,023	2,153,965,442	6,445,130,137
Current Portion of Debentures		39,954,429,113
Other Current Financial Debts	138,658,405	47,742,553	2,123,835
Other Current Liabilities	725,634,281	928,100,732	1,619,177,329
Non-Current Liabilities	108,459,029,287	67,974,250,953	94,038,072,093
Long-Term Trade Payables & Other Payables			526,994,920
Debentures	89,651,200,299	39,808,272,804	79,651,446,254
Long-Term Borrowings	10,000,000,000	20,000,000,000	10,000,000,000
Provision for Severance & Retirement	2,686,715,628	1,337,647,646	1,022,661,622
Deferred Income Tax Credit	2,971,822,786	3,111,539,079	2,251,183,291
Provision for Severance & Retirement	45,000,000	45,000,000	45,000,000
Other Non-Current Financial Debts	3,104,290,574	3,671,791,424	540,786,006
Capital Stock	56,475,975,000	56,475,975,000	56,475,975,000
Capital Surplus	28,525,916,675	28,661,401,156	28,537,826,384
Others	5,973,413,460	6,268,085,019	4,432,702,166
Profit Surplus	106,377,151,431	96,361,614,278	80,281,415,892
Total Equity	197,352,456,566	187,767,075,453	169,727,919,442
Liab. & Shareholder’s Equity	367,656,234,947	344,585,590,175	329,487,453,499

Income Statement
Unit : Korean Won	01/01/2014~09/30/2014	As of 12/31/2013	As of 12/31/2012
Sales	205,355,003,544	286,157,034,520	293,809,915,235
Cost of Sold Goods	165,342,464,846	234,707,031,397	243,782,557,650
Gross Profit	40,012,538,698	51,450,003,123	50,027,357,585
Selling Expenses	9,819,509,741	12,010,345,001	10,892,908,981
Admin. Expenses	10,120,427,395	12,607,994,099	13,259,010,299
Operating Income	20,072,601,562	26,831,664,023	25,875,438,305
Finance Income	1,171,947,464	1,183,901,238	622,194,134
Finance Expenses	4,835,773,893	5,813,626,747	4,848,275,650
Other Non-Operating Income	3,104,407,296	4,739,988,558	23,397,395,301
Other Non-Operating Expenses	579,515,409	1,780,896,634	7,938,044,415
Income Before Taxes	18,933,667,020	25,161,030,438	37,108,707,675
Income Taxes Expenses	3,322,447,074	4,121,336,727	5,946,362,620
Net Income	15,611,219,946	21,039,693,711	31,162,345,055

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	21,794,258,713	40,233,784,298	30,325,049,012
Net Income	15,611,219,946	21,039,693,711	31,162,345,055
Adjustment	17,403,888,589	20,046,001,323	4,218,644,373
Changes in Asset/ & Liability	-6,999,403,448	8,854,711,651	-2,671,858,493
Interests Received	114,484,408	48,267,339	168,400,023
Interests Paid	-4,262,954,522	-5,607,862,276	-4,464,394,940
Dividends Received	2,716,291,280	4,087,694,988	3,977,379,715
Income Taxes	-2,789,267,540	-8,234,722,438	-2,065,466,721
Cash Flows from Investing	-24,092,583,913	-41,072,867,657	-32,169,002,939
Cash Flows from Financing	6,229,850,792	-9,701,180,946	12,658,188,928
Increase/Decrease in Cash	3,931,525,592	-10,540,264,305	10,814,235,001
Cash at the Beginning of Year	1,057,430,996	11,601,831,028	803,706,295
Cash at the End of Year	4,686,115,564	1,057,430,996	11,601,831,028

Products, Technologies, Services Description

Main Products & Services

Hydrogen Peroxide

SB-Latex

Fixing Agent

Wet Strength Agent

Retention Aid

Alkaline Sizing Agent

Chelating Agent

Micro Capsule

Insolubilizer

Organic Coagulant

Polyacrylamide

Decolorizing Agent

Benzoyl Peroxide

Sodium Hydrosulfite

Dye Sublimation Ribbon

Inkjet Printer Ink

Brand Name : Hitex, Han-Floc, Superox

Annual Production Capacity

(Unit : 1,000 Ton)

Factory	03/2011	2010	2009
Ulsan Factory	9.9	39	36
Jeonju Factory	63.3	235.3	224
Total	73.2	274.3	260

Technologies Acquired

Trade Partners & Competitors

Suppliers

SAMSUNG FINE CHEMICALS CO., LTD.(181211-0000013)

HONAM PETRO CHEMICAL CORPORATION(110111-0193196)

HUCHEMSFINECHEMICALCORPORATION(110111-2611906)

LS-NIKKO COPPER INC.(230111-0058436)

Customers

HANSOL PAPER CO., LTD.(110111-0017867)

HANSOL HOMEDECO CO., LTD.(110111-0825624)

SAMYOUNG PURE CHEMICALS CO., LTD.(110111-0655378)

JEONJU PAPER CORPORATION(210111-0022435)

TECHNOSEMICHEM CO., LTD.(110111-0610083)

Competitors

KOREA KUMHO PETRO CHEMICAL CO., LTD.(110111-0205975)

ULSAN PACIFIC CHEMICAL CORP.(110111-0011309)

LG CHEM LTD.(110111-2207995)

DONG HWA ENTERPRISE CO., LTD.(160111-0018104)

Related Parties (Subsidiaries, Joint-Venture & Affiliates)

Affiliates-Domestic	HANSOL HOMEDECO CO.,LTD.(110111-0825624) HANSOL PAPER CO., LTD.(110111-0017867) HANSOL CONSTRUCTION CO.,LTD.(110111-2664400) HANSOL DEVELOPMENT CO., LTD.(141211-0005540) HANSOL LCD INC.(110111-0004682) HANSOL CSN CO.,LTD(110111-0150659) HANSOL EME CO., LTD.(160111-0123185) INNOWAVE CO.,LTD(110111-2296253) HANSOL PNS CO.,LTD. (110111-0175970) SEOUL PAPER CO., LTD.(110111-0990609) CNP CHEMICAL CO., LTD.(124411-0043349) E-SERVICE CO.,LTD.(284311-0011634) HANSOL LIGHTING INC.(110111-3626003) SEOUL PAPER CO.,LTD.(110111-0990609) MUNGYEONG ESCO CO.,LTD.(131311-0079553) HANSOL INTICUBE CO., LTD.(110111-2915605) MAUL SOUP CO., LTD.(110111-3858078) ARTONE PAPER MFG. CO., LTD.(134811-0000034) ULSAN ESCO CO., LTD.(230111-0147122) SAMYOUNG PURE CHEMICALS CO., LTD.(110111-0655378)
Affiliates-Overseas	HANSOL AMERICA, INC. C.K. FIBRES HANSOL DENMARK APS SCHADES HOLDINGS A/S SCHADES A/S SCHADES HOLDINGS LTD. SCHADES LTD. HEIPA TECHNISCHE PAPIERE GMBH SCHADES NORDIC A/S SCHADES SWEDEN AB SCHADES OY SCHADES BENELUX N.V. ? S.A SCHADES HOLDING SAS SNC SCHADES HOLDING SCHADES SNC SCHADES FRANCE EURL HANZEE INDUSTRIAL CO.,LTD. HANSOL NEW ZEALAND KOPRI INC. HANSOL TECHNICS THAILAND HANSOL TECHNICS EUROPE S.R.O HANSOL CSN LOGISTICS (SHAGHAI) CO., LTD. HANSOL CSN LOGISTICS (TIANJIN) CO., LTD. HANSOL GOLD POINT LLC HANSOL CSN LOGISTICS INDIA PRIVATE LIMITED HANSOL CSN LOGISTICS MALAYSIA SDN.BHD HANSOL CSN LOGISTICS (HONG KONG) CO. LTD. HANSOL LOGISTICS VINA CO. LTD. TIANJIN C&P CHEMICAL CO., LTD. HANSOL CNP VINA CO., LTD. HANSOL ELECTRONIC MATERIALS (XI'AN) CO.,LTD. HANSOL ELECTRONICS VIETNAM CO.,LTD. TOKYO KAKOHKI CO.,LTD.
Subsidiary	INNOPTIX CO., LTD.(110111-2296253) (69.91% held by the subject company) DAEYOUNG POLYMERS.CO., LTD.(124411-0043349) (90.0% held by the subject company)
Cooperative Enterprise	-Insured Company LIG INSURANCE CO., LTD.(110111-0017859)

Sales by Region (Activity & Markets)

Sales/ Unit :Mil KRW	2011	2010	2009
Export	29,746	26,785	23,833
Domestic	248,878	201,466	168,543
Total	278,623	228,251	192,377

The subject deals with the companies in China, Hong Kong and Japan.

Court Action

No.

News Clipping

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.97
UK Pound	1	Rs.97.37
Euro	1	Rs.77.16

INFORMATION DETAILS

Analysis Done by :	DIV

Report Prepared by :	SMN

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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