MIRA INFORM REPORT

Report Date :

04.10.2014

IDENTIFICATION DETAILS

Name :	HYUNDAI WELDING CO., LTD.

Registered Office :	507, Teheran-ro, Gangnam-gu, Seoul, Korea

Country :	South Korea

Financials (as on) :	31.12.2013

Date of Incorporation :	03.09.1975

Com. Reg. No.:	214-81-24202

Legal Form :	Company Limited By Shares

Line of Business :	Manufacture of Other Fabricated and Processed Metal Products.

No of Employees :	830

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 :	Slow but correct
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	HYUNDAI WELDING CO., LTD. (Korean Company Name : “현대종합금속(주)”)
Registered Address	507, Teheran-ro, Gangnam-gu, Seoul, Korea
Building	16th Fl., Ilsong Bldg.
Zip Code	135-880
Tel	+82-2-6230-6010~2
Fax	+82-2-598-6928
E-mail	matthew@hyundaiwelding.com;grkim@hyundaiwelding.com
Website	www.hdweld.co.kr
Trading Address	16th Fl., Ilsong Bldg., 507, Teheran-ro, Gangnam-gu, Seoul, Korea (Old Address System : 16th Fl., Ilsong Bldg., 157-37, Samseong 1-dong, Gangnam-gu, Seoul, Korea)
Tel	+82-2-6230-6010~2
Fax	+82-2-598-6928
Other Address-Icheon Factory	9-2, Saeum-dong, Icheon-si, Gyeonggi-do, Korea
Tel	+82-31-636-3100
Fax	+82-31-636-3957
Other Address-Pohang Factory	90-5, Jangheung-dong, Nam-gu, Pohang-si, Gyeongsangbuk-do, Korea
Tel	+82-54-289-6214
Fax	+82-54-286-6275
Other Address-Ulsan Office	843-2, Hyomun-dong, Buk-gu, Ulsan, Korea
Tel	+82-52-276-1063
Fax
Other Address-Geoje Office	1058-8, Mujeon-dong, Tongyeong-si, Gyeongsangnam-do, Korea
Tel	+82-55-688-5812
Fax
Other Address-Daegu Office	1st Fl., Samwon Bldg., 414-3, Manchon-dong, Suseong-gu, Daegu, Korea
Tel	+82-53-751-7071
Fax
Other Address-Daejeon Branch	254-23, Daehwa-dong, Daedeok-gu, Daejeon, Korea
Tel	+82-42-635-2240
Fax
Other Address-Gwangju Branch	1588-1, Usan-dong, Gwangsan-gu, Gwangju, Korea
Tel	+82-61-462-9984
Fax	+82-61-462-9985
Other Address-Busan Office	229, Bujeon-dong, Busanjin-gu, Busan, Korea
Tel	+82-51-802-1124
Fax	+82-51-802-4445
Type	Export/Import
Industry	Manufacture of Other Fabricated and Processed Metal Products n.e.c
Main Business	Welding Electrodes, Micro Plasma Welding Machines, Solid Wire, Welders
Sub Business
Established (mm/dd/yyyy)	09/03/1975

The Subject owns the premises of Pohang Factory.

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Welders(23171508)
Sell	Welding rods(23171512)
Sell	Welding wire(23171510)

CEO’s

Name	Lee Jae-Soo
Address	Suite 101-1506, 14, Saecheonnyeon-daero 1123beon-gil, Buk-gu, Pohang-si, Gyeongsangbuk-do, Korea
Date of Birth	06/24/1953
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

5,749,820,000

Employees

830

Formation

Co., Ltd by shares

Bank Details

Woori Bank

Kookmin Bank

Shinhan Bank-Seocho Branch

Korea Exchange Bank

Korea Development Bank

Corporate Registered No.

110111-0185193

Business Registered No.

214-81-24202

Permit & Licenses

02/1995 ISO 9002 by LRQA

12/16/1998 ISO 9001

01/09/2000 KS Mark

Int’l Trade No.: 771535

Shareholder Position

Name	Shares	%
CHUNG MONG-SEOK & OTHERS(2)	1,149,964	100.00
TOTAL	1,149,964	100.00

Company History

09/03/1975 Incorporated as SEOHAN DEVELOPMENT CO., LTD.

08/1976 Completed calcium carbide factory in Danyang

01/1977 Completed electrode plant in Pohang

05/1978 Established new submerged wire production facilities

09/1978 Established new solid wire production facilities

09/1978 Established a technical tie with Sweden ESAB Corporation and imported submerged arc welding flux production technology

12/1980 Initiated submerged arc welding flux production

01/1984 Produced low fume electrode for the first time in Korea

02/1986 Certified by Japanese Industrial Standard Marking Institute

01/1987 Changed a company name as HYUNDAI WELDING CO., LTD.

09/1989 Initiated metal stamping business

10/1989 Established HYUNDAI WELDING JAPAN CO., LTD in Tokyo

01/1994 Established HYUNDAI WELDING (S'PORE) PTE., LTD.

02/1994 Established a technical tie with OERLIKON Corporation in Switzerland and imported stainless electrode production technology

02/1995 Obtained ISO 9002 certificate (LRQA Certificate No. 941752)

03/1995 Established SUNGWOO PRECISION CO., LTD.

09/1995 Expanded electrode production facilities in Pohang (3,000MT / Month)

09/1995 Expanded solid wire production facilities in Pohang (3,000MT / Month)

04/1996 Expanded flux cored wire production facilities in Pohang (3,000MT / Month)

06/1996 Established H.W.M.C. Malaysia SDN. BHD.

12/1996 Established HYUNDAI WELDING (Europe) GmbH

02/1997 Established HYUNDAI WELDING PRODUCTS. INC(USA)

04/1997 Completed SUNGWOO PRECISION factory in Echeon

09/1997 HYUNDAI WELDING COMPANY(Australia)

10/1997 HYUNDAI WELDING PRODUCTS S.A.(South Africa)

12/1997 Established R&D Center in Pohang

07/1999 Acknowledged Pohang R&D Center (attached) by Korea Industrial Technology Association (No. 991626)

04/2001 Merged with SUNGWOO PRECISION CO., LTD.

08/2001 Acknowledged Echeon R&D Center (attached) by Korea Industrial Technology Association (No. 20012522)

06/27/2002 Moved to the present HQ address from 1424-2, Seocho-dong, Seocho-gu, Seoul, Korea

08/09/2013 Increased the authorized shares to 1,500,000 shares from 1,200,000 shares

08/09/2013 Increased capital to 5,749,820,000 KRW from 5,000,000,000 KRW

08/09/2013 Acquired GLOVIL PROCESS CO., LTD.

Detailed Information

Management

Job Description	Title	Name	Sex	Nationality	Inauguration Date
President & CEO	Mr.	Lee Jae-Soo	Male	Korean	03/31/2014
Director	Mr.	Chung Mong-Seok	Male	Korean	03/27/1994
Director	M/S.	Ahn Jung-Hae	Female	Korean	03/02/2001
Auditor	Mr.	Chung Eun-Sung	Male	Korean	05/17/2006
Supervisor	Mr.	Baik Seung-Kyu	Male	Korean	07/25/2005

Financials

Year / Unit : KRW	Sales	Assets	Net Income
2013	488,629,255,834	649,301,405,707	9,790,228,298
2012	564,561,582,670	601,842,261,048	16,106,634,635
2011	545,268,226,871	610,639,932,648	26,301,083,161
2010	445,648,249,227	686,742,041,457	38,543,193,053
2009	421,937,456,557	460,915,154,484	11,701,234,546
2008	437,744,162,775	485,294,417,416	23,453,778,693
2007	285,857,919,177	539,400,902,009	6,278,432,406
2006	252,160,909,997	249,618,871,528	8,192,521,619
2005	210,033,997,791	215,391,401,107	7,982,015,743
2004	177,272,417,896	150,849,303,237	8,637,465,594

Financial Description

Authorized Capital(KRW)	7,500,000,000
Paid-Up Capital(KRW)	5,749,820,000
Total Issued Shares	1,149,964

Balance Sheet
Unit : Korean Won	As of 12/31/2013	As of 12/31/2012	As of 12/31/2011
Total Assets	649,301,405,707	601,842,261,048	610,639,932,648
Current Assets	238,231,110,914	236,155,193,973	248,710,196,330
-Quick Assets	137,365,804,438	145,066,309,870	158,947,554,573
-Inventories	100,865,306,476	91,088,884,103	89,762,641,757
Fixed Assets	411,070,294,793	365,687,067,075	361,929,736,318
-Investment	281,119,853,091	251,498,168,252	267,105,694,185
-Tangibles	108,502,012,686	104,995,669,478	86,890,568,543
-Intangibles	10,518,603,863	54,637,226	56,671,057
-Others	10,929,825,153	9,138,592,119	7,876,802,533
Total Liabilities	378,049,771,857	367,312,156,832	366,014,212,930
Current Liabilities	254,207,598,496	256,757,001,408	281,045,036,915
Fixed Liabilities	123,842,173,361	110,555,155,424	84,969,176,015
Capital Stock	5,749,820,000	5,000,000,000	5,000,000,000
Capital Surplus	41,868,220,161	21,040,769,949	21,040,769,949
Profit Surplus	89,549,815,804	79,759,587,506	77,652,952,871
Capital Adjustment	134,083,777,885	128,729,746,761	140,931,996,898
Total Equity	271,251,633,850	234,530,104,216	244,625,719,718
Liab. & Shareholder’s Equity	649,301,405,707	601,842,261,048	610,639,932,648

Current Liabilities	254,207,598,496	256,757,001,408	281,045,036,915
Trade Payables	57,139,107,494	50,349,661,118	60,865,906,062
Account Payables	9,694,220,330	9,508,574,050	13,767,160,881
Advance Receipts	2,849,280,943	433,005,806	172,976,399
Withholdings	1,262,991,726	1,311,863,924	1,233,793,431
Accrued Expenses	3,503,370,642	3,469,322,751	4,244,402,437
Guarantee Deposit Withhold	58,000,000	185,000,000	55,000,000
Short-Term Borrowings	162,500,000,000	158,492,269,429	178,731,923,500
Current Portion of Debentures	-	20,000,000,000	-
Current Portion of Long-Term Debts	17,020,000,000	12,489,995,100	7,558,327,500
Accrued Income Tax	180,627,361	517,309,230	14,415,546,705
Fixed Liabilities	123,842,173,361	110,555,155,424	84,969,176,015
Debentures	10,000,000,000	-	20,000,000,000
Long-Term Borrowings	62,553,000,000	67,251,855,600	19,541,850,700
Provision for Severance & Retirement	13,958,025,017	11,485,678,079	9,793,865,617
Long-Term Account Payables	293,697,689	82,855,776	207,638,710
Deferred Income Tax Credit	49,324,787,950	42,016,158,713	45,219,686,605

Income Statement
Unit : Korean Won	As of 12/31/2013	As of 12/31/2012	As of 12/31/2011
Sales	488,629,255,834	564,561,582,670	545,268,226,871
Cost of Sold Goods	418,527,288,319	488,051,325,718	454,561,339,505
Gross Profit	70,101,967,515	76,510,256,952	90,706,887,366
Selling & Admin. Expenses	51,530,565,929	47,709,646,551	45,394,459,590
Operating Income	18,571,401,586	28,800,610,401	45,312,427,776
Non-Operating Income	18,469,926,951	12,237,236,726	21,887,636,657
Non-Operating Expenses	25,406,312,374	22,770,554,725	22,002,985,942
Income Before Taxes	11,635,016,163	18,267,292,402	45,197,078,491
Income Taxes Expenses	1,844,787,865	2,160,657,767	18,895,995,330
Net Income	9,790,228,298	16,106,634,635	26,301,083,161

Cash Flows
Unit : Korean Won	As of 12/31/2013	As of 12/31/2012	As of 12/31/2011
Cash Flows from Operating	24,645,588,329	17,090,210,665	766,876,464
-Net Income	9,790,228,298	16,106,634,635	26,301,083,161
-Exp. without Cash Outflow	27,978,808,186	17,899,317,058	15,482,635,818
-Revenue without Cash Inflows	-10,397,438,379	-2,422,077,340	-7,229,793,544
-Changes in Asset/ & Liability	-2,726,009,776	-14,493,663,688	-33,787,048,971
Cash Flows from Investing	2,569,327,979	-40,078,124,114	-24,119,948,233
-Cash Inflow from Investing	28,150,370,980	3,095,382,064	3,465,862,629
-Cash Outflows for Investing	-25,581,043,001	-43,173,506,178	-27,585,810,862
Cash Flows from Financing	-33,121,120,129	18,402,018,429	25,626,480,622
-Cash Inflows from Financing	375,000,000,000	663,756,445,449	455,998,762,072
-Cash Outflows from Financing	-408,121,120,129	-645,354,427,020	-430,372,281,450
Increase/Decrease in Cash	-5,906,203,821	-4,585,895,020	2,273,408,853
Cash at the Beginning of Year	23,433,814,644	28,019,709,664	25,746,300,811
Cash at the End of Year	17,527,610,823	23,433,814,644	28,019,709,664

Products, Technologies, Services Description

Main Products & Services

Welding Consumables

-Covered Electrodes

-Submerged Flux & Wire

-Solid Wire

-FCW

-MIG/TIG

Welding Machines

-TIG

DC ARC

Air Plasma Cutter

Detailed Products Spec.

Technologies Acquired

Trade Partners & Competitors

Suppliers

POSCO SPECIALTY STEEL CO., LTD.(194211-0025248)

POSCO(174611-0000741)

KOREA GAS CORPORATION(114671-0006125)

Customers

Competitors

KISWEL CO., LTD.

721-3, HAKJANG-DONG, SASANG-GU, BUSAN, KOREA

TEL:+82-51-317-3131~40 FAX:+82-51-325-3627

CHOSUN WELDING CO., LTD.

865, JANGHEUNG-DONG, NAM-GU, POHANG-SI, GYEONGSANGBUK-DO, KOREA

TEL:+82-54-285-8221 FAX:+82-54-285-8543

CHEGIM WELDING CO., LTD.

42-499, IHYEON-DONG, SEO-GU, DAEGU, KOREA

TEL:+82-53-250-0600 FAX:+82-53-256-8117

Sales by Region (Activity & Markets)

The Subject exports to Europe, Asia and North America.

Court Action

No.

News Clipping

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.75
UK Pound	1	Rs.100.07
Euro	1	Rs.77.95

INFORMATION DETAILS

Analysis Done by :	KAR

Report Prepared by :	TPT

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.