MIRA INFORM REPORT

Report Date :

23.09.2014

IDENTIFICATION DETAILS

Name :	FORMETAL CO., LTD.

Registered Office :	229-7, Mujangsaneop-ro, Jigok-myeon, Seosan-si, Chungcheongnam-do, Korea 10B-1L, Seosan 1 Industrial Complex 356-863

Country :	South Korea

Financials (as on) :	31.12.2013

Date of Incorporation :	31.08.1985

Com. Reg. No.:	134-81-06140

Legal Form :	Listed Company

Line of Business :	Forging of Metal Precision Die Forging, Combination Forging, Precision Rpess Forging, Nonferrous Metal Forging, Free Forging Press, Ring Rolling

No. of Employees :	124

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

Basic

Company Name	FORMETAL CO., LTD. (Korean Company Name : “(주)포메탈”)
Registered Address	229-7, Mujangsaneop-ro, Jigok-myeon, Seosan-si, Chungcheongnam-do, Korea
Building	10B-1L, Seosan 1 Industrial Complex
Zip Code	356-863
Tel	+82-41-670-6200
Fax	+82-41-668-7316
E-mail	csy@formetal.co.kr
Website	www.formetal.co.kr
Trading Address	10B-1L, Seosan 1 Industrial Complex, 229-7, Mujangsaneop-ro, Jigok-myeon, Seosan-si, Chungcheongnam-do, Korea (Old Address System : 10B-1L, Seosan 1 Industrial Complex, 1741, Mujang-ri, Jigok-myeon, Seosan-si, Chungcheongnam-do, Korea)
Tel	+82-41-670-6200
Fax	+82-41-668-7316
Other Address
Tel
Fax
Type	Export/Import
Industry	Forging of Metal
Main Business	Precision Die Forging, Combination Forging, Precision Rpess Forging, Nonferrous Metal Forging, Free Forging Press, Ring Rolling
Sub Business
Established (mm/dd/yyyy)	08/31/1985

Detailed Products

Activity	Detailed Products (UNSPSC)
Sell	Arms and ammunition accessories(46101800)
Sell	Compressor parts or accessories(40151610)
Sell	Transportation components and systems(25170000)

CEO’s

Name	Oh Se-Won
Address
Date of Birth	12/10/1935
Title	President & CEO
Sex	Male
Nationality	Korean

Profiles

Capital (KRW)

6,012,340,000

Employees

124

Formation

Listed Company (KOSDAQ : 119500) as of 09/17/2010

Bank Details

Industrial bank of Korea-Banwol Branch

Corporate Registered No.

130111-0010669

Business Registered No.

134-81-06140

Permit & Licenses

02/05/2009 ISO 9001

01/16/2009 ISO16949

04/08/2008 ISO 14001

11/01/2006 INNO-BIZ

12/01/2005 ISO/TS16949

08/21/2000 QS 9000

08/21/2000 ISO 9002

07/29/1997 ISO 9002

Int’l Trade No.: 612357

Shareholder Position

Name	Shares	%
OH SE-WON	3,667,720	30.50
KIM KI-JUNG	3,667,720	30.50
OTHERS	4,689,240	39.00
TOTAL	12,024,680	100.00

Company History

10/15/1969 Established as HYUPJIN METAL INDUSTRIES CO.(Sole Proprietorship)

08/31/1985 Incorporated as HYUPJIN METAL CO., LTD.

12/23/2009 Changed company name to the present name

12/28/2012 Awarded US$ 10 Million Export Top Prize

03/22/2013 Designated as an INNO-BIZ Company

Detailed Information

Management

Job Description	Title	Name	Nationality	Date of Birth	Education
President & CEO	Mr.	Oh Se-Won	Korean	1935.12.10	Chungang University, Korea
President	Mr.	Kim Ki-Jung	Korean	1935.02.28	Chungang University, Korea
Vice President	Mr.	Kim Sung-Ho	Korean	1965.06.08	Yonsei University, Korea
Vice President	Mr.	Park Byung-Soo	Korean	1958.04.30	Korea Polytechnic University(KPU), Korea
Executive Director	Mr.	Oh Ho-Seok	Korean	1968.08	Yonsei University, Korea
Outside Director	Mr.	Sohn Choong-Ryeol	Korean	1945.05	Ahen College, German
Outside Director	Mr.	Oh Choong-Seok	Korean	1965.03	-
Auditor	Mr.	Ra Soo-Hyun	Korean	1946.11.21	-

Financials

Year / Unit : KRW	Sales	Assets	Net Income
(*)06/2014	26,607,635,524	61,815,940,949	577,807,718
(*)2013	52,351,487,632	60,189,456,360	1,393,320,469
(*)2012	51,788,896,558	60,004,853,138	4,531,819,335
2011	67,628,111,270	53,275,661,704	5,196,689,980
2010	55,721,504,725	43,553,690,406	3,854,210,871

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

Financial Description

Authorized Capital(KRW)	25,000,000,000
Paid-Up Capital(KRW)	6,012,340,000
Total Issued Shares	12,024,680

Balance Sheet
Unit : Korean Won	01/01/2014~06/30/2014	As of 12/31/2013	As of 12/31/2012
Total Assets	61,815,940,949	60,189,456,360	60,004,853,138
Current Assets	20,241,810,148	18,688,699,780	15,251,434,071
Cash & Cash Equivalents	4,748,222,104	4,956,912,840	2,760,420,495
Short-Term Receivables	1,300,000,000	1,300,000,000	2,000,000,000
Trade Receivables	8,867,842,766	8,580,907,160	6,684,774,428
Other Receivables	90,447,011	68,969,105	90,920,240
Inventories	5,183,887,290	3,562,933,650	3,387,616,778
Other Current Assets	51,410,977	218,977,025	327,702,130
Assets to be Sold			2,615,792,668
Non-Current Assets	41,574,130,801	41,500,756,580	42,137,626,399
Non-Current Financial Instruments	4,432,664,405	4,377,973,607	5,695,955,607
Tangibles	36,893,964,723	36,801,093,610	36,004,031,061
Intangibles	231,311,673	278,499,363	372,874,731
Other Non-Current Assets	16,190,000	43,190,000	64,765,000
Total Liabilities	24,008,807,934	22,569,693,466	22,906,580,252
Current Liabilities	16,001,839,909	14,075,379,000	13,807,007,925
Trade Payables	7,764,802,119	7,385,965,990	6,273,680,372
Other Payables	1,442,661,785	994,099,848	664,072,108
Short-Term Borrowings	4,664,389,884	4,095,468,122	5,496,007,697
Current Portion of Long-Term Debts	1,248,450,000	755,166,000	539,532,000
Other Current Liabilities	749,348,655	844,679,040	833,715,748
Accrued Income Tax	132,187,466
Non-Current Liabilities	8,006,968,025	8,494,314,466	9,099,572,327
Long-Term Borrowings	6,178,750,000	6,965,650,000	7,720,816,000
Provision for Severance & Retirement	653,414,908	393,715,972	607,169,196
Other Non-Current Financial Debts	105,000,000	105,000,000	100,000,000
Deferred Income Tax Credit	1,069,803,117	1,029,948,494	671,587,131
Capital Stock	6,012,340,000	6,012,340,000	6,012,340,000
Capital Surplus	7,565,239,543	7,565,239,543	7,565,239,543
Others	-1,003,691,880	-957,514,515	-30,004,855
Installments	-21,163,567	-2,566,175	-65,653,337
Profit Surplus	25,254,408,919	25,002,264,041	23,616,351,535
Total Equity	37,807,133,015	37,619,762,894	37,098,272,886
Liab. & Shareholder’s Equity	61,815,940,949	60,189,456,360	60,004,853,138

Income Statement
Unit : Korean Won	01/01/2014~06/30/2014	As of 12/31/2013	As of 12/31/2012
Sales	26,607,635,524	52,351,487,632	51,788,896,558
Cost of Sold Goods	23,123,636,676	46,725,116,846	46,263,302,492
Gross Profit	3,483,998,848	5,626,370,786	5,525,594,066
Selling & Admin. Expenses	2,615,845,146	4,999,321,601	4,911,443,432
Operating Income	868,153,702	627,049,185	614,150,634
Other Income	211,108,340	1,591,490,052	6,242,896,174
Other Expenses	204,643,009	833,866,771	1,698,373,984
Finance Income	125,998,404	395,166,575	444,013,824
Finance Expenses	230,686,081	607,915,505	355,712,528
Income Before Taxes	769,931,356	1,171,923,536	5,246,974,120
Income Taxes Expenses	192,123,638	-221,396,933	715,154,785
Net Income	577,807,718	1,393,320,469	4,531,819,335

Cash Flows
Unit : Korean Won	01/01/2014~06/30/2014	As of 12/31/2013	As of 12/31/2012
Operating Activities Cash Flows	845,838,579	1,839,352,712	4,567,234,474
Cash Flows from Operating	985,770,404	1,532,275,819	5,972,330,206
Interests Received	193,777,617	406,066,154	496,622,990
Interests Paid	-242,114,136	-479,415,463	-659,244,832
Income Taxes	-91,595,306	380,426,202	-1,242,473,890
Cash Flows from Investing	-957,976,183	3,679,246,039	-7,247,340,541
Cash Inflow from Investing	1,771,305,170	10,848,540,764	28,507,555,842
Cash Outflows for Investing	-2,729,281,353	-7,169,294,725	-35,754,896,383
Cash Flows from Financing	-96,534,443	-3,322,106,435	3,276,633,956
Cash Inflows from Financing	5,852,964,538	11,255,908,820	24,408,776,621
Cash Outflows from Financing	-5,949,498,981	-14,578,015,255	-21,132,142,665
Increase/Decrease in Cash	-208,672,047	2,196,492,316	596,527,889
Cash at the Beginning of Year	4,956,912,840	2,760,420,495	2,265,724,488
Cash at the End of Year	4,748,222,104	4,956,912,840	2,760,420,495

Products, Technologies, Services Description

Main Products & Services	Precision Die Forging, Combination Forging, Precision Rpess Forging, Nonferrous Metal Forging, Free Forging Press, Ring Rolling
Detailed Products Spec.
Technologies Acquired

Trade Partners & Competitors

Suppliers

Customers

Competitors

PYUNG HWA ANTI-VIBRATION SYSTEM CO., LTD.

29-17, BONRI-RI, NONGONG-EUP, DALSEONG-GUN, DAEGU, KOREA

TEL:+82-53-610-7000 FAX:+82-53-615-0566

SKF KOREA CO., LTD.

1171, JISA-DONG, GANGSEO-GU, BUSAN, KOREA

TEL:+82-51-970-2401 FAX:+82-51-970-2498

KOREA SINTERED METAL CO., LTD.

DALSEONG INDUSTRIAL COMPLEX, 29-10, BONRI-RI, NONGONG-EUP, DALSEONG-GUN, DAEGU, KOREA

TEL:+82-53-610-0700 FAX:+82-53-610-0701

Sales by Region (Activity & Markets)

Sales/ Unit :Mil KRW	06/2014	2013	2012
Export	4,081	8,449	9,559
Domestic	22,527	43,902	42,230
Total	26,608	52,351	51,789

The Subject deals with the companies in Japan.

Court Action

No.

News Clipping

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.60.78
UK Pound	1	Rs.99.27
Euro	1	Rs.78.16

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.