MIRA INFORM REPORT

Report No. :	319445
Report Date :	29.04.2015

IDENTIFICATION DETAILS

Name :	CIMM GROUP CO., LTD.

Registered Office :	17/F Chengda Building, No. 71 Renmin Road, Zhongshan District Dalian, Liaoning Province 116001 Pr

Country :	China

Financials (as on) :	31.12.2014

Date of Incorporation :	18.02.1998

Com. Reg. No.:	210200000113723

Legal Form :	Limited Liability Company

Line of Business :	Subject includes importing and exporting various kinds of commodities and technology (with permit), processing with imported materials, processing with imported samples, assembling with imported parts, and compensation trade in agreement; counter trade & transit trade; project investment (excluding special approval); contracting foreign projects suited to its strength, size and outstanding achievement; dispatching labor abroad in the fields of engineering; business management services; wholesaling pre-packaged foods, dairy products (including infant formula milk powder)

No. of Employees :	120

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate

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 – December 31, 2014

Country Name

Previous Rating

(30.09.2014)

Current Rating

(31.12.2014)

China

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	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. In 2014 the People’s Bank of China (PBOC) doubled 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 2014 stood as the largest economy in the world, surpassing the US that year 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; 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. In 2014 China agreed to begin limiting carbon dioxide emissions by 2030. China implemented several economic reforms in 2014, including legislation allowing local governments to issue bonds, further opening several state-owned enterprises to private investment, loosening the one-child policy, passing harsher pollution fines, and cutting administrative red tape.

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. In 2014 China agreed to begin limiting carbon dioxide emissions by 2030. China implemented several economic reforms in 2014, including legislation allowing local governments to issue bonds, further opening several state-owned enterprises to private investment, loosening the one-child policy, passing harsher pollution fines, and cutting administrative red tape.

Source : CIA

Company Name and address

CIMM GROUP CO., LTD.

17/F CHENGDA BUILDING, NO. 71 RENMIN ROAD, ZHONGSHAN DISTRICT

DALIAN, LIAONING PROVINCE 116001 PR CHINA

TEL: 86 (0) 411-82511706/82511719/82511723/25/26

FAX: 86 (0) 411-82511721/82511722

EXECUTIVE SUMMARY

Date of Registration : FEBRUARY 18, 1998

REGISTRATION NO. : 210200000113723

LEGAL FORM : Limited Liability Company

CHIEF EXECUTIVE : MA SHUJUN (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : CNY 50,875,600

staff : 120

BUSINESS CATEGORY : TRADING & ENGINEERING

Revenue : CNY 258,456,000 (AS OF DEC. 31, 2014)

EQUITIES : CNY 59,770,000 (AS OF DEC. 31, 2014)

WEBSITE : www.cimmuk.com

E-MAIL : sales@cimmuk.com

PAYMENT : AVERAGE

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : fairly stable

OPERATIONAL TREND : fairly STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.20 = 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 limited liabilities company of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 210200000113723 on February 18, 1998.

SC’s Organization Code Certificate No.: 70216340-2

SC’s registered capital: CNY 50,875,600

SC’s paid-in capital: CNY 50,875,600

Registration Change Record:-

Date	Change of Contents	Before the change	After the change
--	Registration No.	2102002120636	210200000113723
2010	Registered Capital	CNY 20,160,000	CNY 25,160,000
2011	Registered Capital	CNY 25,160,000	CNY 50,875,600
2011	Shareholder (s) (% of Shareholding)	Ma Shujun 51.27% Liu Fengying 16.02% Ma Bingwen 17.21% Ma Shuqin 15.50%	Ma Shujun 75.90% Liu Fengying 7.92% Ma Bingwen 8.51% Ma Shuqin 7.67%

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

Name of Shareholder (s)	% of Shareholding
Ma Shujun	75.90
Liu Fengying	7.92
Ma Bingwen	8.51
Ma Shuqin	7.67

SC’s Chief Executives:-

Position	Name
Legal Representative, Chairman, and General Manager	Ma Shujun
Director	Liu Fengying
Director	Ma Shuqin
Supervisor	Ma Bingwen

RECENT DEVELOPMENT

No recent development was found during our checks at present.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

Ma Shujun 75.90

Liu Fengying 7.92

Ma Bingwen 8.51

Ma Shuqin 7.67

MANAGEMENT

Ma Shujun, Legal Representative, Chairman and General Manager

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

Ø Gender: M

Ø Age: 40’s

Ø Qualification: University

Ø Working experience (s):

From 1998 to present, working in SC as legal representative, chairman and general manager

Also working in Dalian Zhongji Metallurgy Co., Ltd. as legal representative

Director

-----------

Liu Fengying

Ma Shuqin

Supervisor

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

Ma Bingwen

BUSINESS OPERATION

SC’s registered business scope includes importing and exporting various kinds of commodities and technology (with permit), processing with imported materials, processing with imported samples, assembling with imported parts, and compensation trade in agreement; counter trade & transit trade; project investment (excluding special approval); contracting foreign projects suited to its strength, size and outstanding achievement; dispatching labor abroad in the fields of engineering; business management services; wholesaling pre-packaged foods, dairy products (including infant formula milk powder)

SC is mainly engaged in international trade and contracting foreign projects.

SC’s products mainly include: aluminum fluoride, refractory, baked anode, cathode carbide block, graphite, cryolite, machinery and mechanical equipment, carbon products, refractory materials, etc.

SC sources its merchandise 95% from domestic market, mainly Dalian, and 5% from overseas market. SC sells 95% of its products to overseas market, mainly Pakistan, India, Turkey, Egypt, Greece, Braze, S. Africa, etc., and 5% 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 Customer*

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

Voestalpine Stahl GmbH

Staff & Office:

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

SC is known to have approx. 120 staff at present.

SC rents an area as its operating office, but the detailed information is unknown.

RELATED COMPANY

n Zibo Liancheng Fluorochemicals Co., Ltd.

n CIMM Automation Engineering Technology (Dalian) Co., Ltd.

Etc.

SC is known to invest in the following companies,

n China Metallurgy Engineering & Design Consortium Group

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

Chief Executive: Yu Yan

Registration No.: 210200000289109

Date of Registration: 2005-11-29

n Dalian Zhongji Metallurgy Co., Ltd.

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

Chief Executive: Ma Shujun

Registration No.: 210200000289230

Date of Registration: 2005-03-28

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

Basic Bank:

Bank of China Liaoning Branch

AC#: N/a

FINANCIALS

Balance Sheet

Unit: CNY’000	As of Dec. 31, 2013	As of Dec. 31, 2014
Cash	86,050	62,933
Notes receivable	1,010	140
Accounts receivable	73,290	57,625
Advances to suppliers	54,090	9,264
Other receivable	12,880	12,881
Inventory	9,530	3,822
Non-current assets within one year	0	0
Other current assets	0	0
	------------------	------------------
Current assets	236,850	146,665
Long-term investments	73,330	113,330
Fixed assets	1,750	1,138
Intangible assets	25,710	20,572
Long-term prepaid expenses	0	0
Deferred income tax assets	0	0
Other non-current assets	0	0
	------------------	------------------
Total assets	337,640	281,705
	=============	=============
Short-term loans	54,750	44,750
Notes payable	31,850	0
Accounts payable	94,390	55,773
Wages payable	0	0
Taxes payable	-150	-624
Advances from clients	40,420	31,904
Other payable	56,530	90,132
Other current liabilities	0	0
	------------------	------------------
Current liabilities	277,790	221,935
Non-current liabilities	0	0
	------------------	------------------
Total liabilities	277,790	221,935
Equities	59,850	59,770
	------------------	------------------
Total liabilities & equities	337,640	281,705
	=============	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2013	As of Dec. 31, 2014
Revenue	347,960	258,456
Cost of sales	301,680	223,916
Taxes and surcharges	90	221
Sales expense	27,140	24,525
Management expense	17,200	11,142
Finance expense	1,280	846
Non-operating income	110	2,772
Non-operating expense	0	114
Profit before tax	680	464
Less: profit tax	170	116
Profits	510	348

Important Ratios

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

	As of Dec. 31, 2013	As of Dec. 31, 2014
*Current ratio	0.85	0.66
*Quick ratio	0.82	0.64
*Liabilities to assets	0.82	0.79
*Net profit margin (%)	0.15	0.13
*Return on total assets (%)	0.15	0.12
*Inventory / Revenue ×365	10 days	6 days
*Accounts receivable/ Revenue ×365	77 days	82 days
*Revenue/Total assets	1.03	0.92
*Cost of sales / Revenue	0.87	0.87

FINANCIAL COMMENTS

PROFITABILITY: AVERAGE

l The revenue of SC appears fairly good in its line, and it decreased in 2014.

l SC’s net profit margin is average.

l SC’s return on total assets is average.

l SC’s cost of sales is average, comparing with its revenue.

LIQUIDITY: FAIR

l The current ratio of SC is maintained in a fair level.

l SC’s quick ratio is maintained in a normal level.

l The inventory of SC is maintained in an average level.

l The accounts receivable of SC appears large.

l The short-term loans of SC appear large.

l SC’s revenue is in an average level, comparing with the size of its total assets.

LEVERAGE: FAIR

l The debt ratio of SC is fairly high.

l The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly Stable.

CONCLUSIONS

SC is considered medium-sized in its line with fairly stable financial conditions. The large amount of accounts receivable and short-term loans may be a threat to SC’s financial condition.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.63.33
UK Pound	1	Rs.96.52
Euro	1	Rs.68.93

INFORMATION DETAILS

Analysis Done by :	DIV

Report Prepared by :	NIT

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.