MIRA INFORM REPORT

Report No. :	325790
Report Date :	10.06.2015

IDENTIFICATION DETAILS

Name :	TAITA CHEMICAL CO., LTD.
Registered Office :	12F., No.37 Ji-Hu Rd., Nei-Hu Dist., Taipei
Country :	Taiwan
Financials (as on) :	31.12.2014
Date of Incorporation :	06.04.1990
Com. Reg. No.:	11893409
Legal Form :	Joint Stock Company
Line of Business :	Manufacturing and Sale of Chemicals.
No. of Employee :	About 400

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 :	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)
Taiwan	A2	A1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

TAIWAN ECONOMIC OVERVIEW

Taiwan has a dynamic capitalist economy with gradually decreasing government guidance of investment and foreign trade. Exports, led by electronics, machinery, and petrochemicals have provided the primary impetus for economic development. This heavy dependence on exports exposes the economy to fluctuations in world demand. Taiwan's diplomatic isolation, low birth rate, and rapidly aging population are other major long-term challenges. Free trade agreements have proliferated in East Asia over the past several years, and following the landmark Economic Cooperation Framework Agreement (ECFA) signed with China in June 2010, Taiwan in July 2013 signed a free trade deal with New Zealand—Taipei’s first-ever with a country with which it does not maintain diplomatic relations—and in November inked a trade pact with Singapore. However, negotiations on follow-on components of ECFA, including an agreement on trade in services, deals on trade in goods, and dispute resolution—have stalled. In early 2014, the government bowed to public demand for a new law governing the oversight of cross-Strait agreements, before any additional deals with China are implemented; the legislature has yet to vote on such legislation, leaving the future of ECFA up in the air as President MA enters his final full year in office. MA has portrayed ECFA as Taiwan’s key to greater participation in East Asia’s free trade networks. Taiwan's Total Fertility rate of just over one child per woman is among the lowest in the world, raising the prospect of future labor shortages, falling domestic demand, and declining tax revenues. Taiwan's population is aging quickly, with the number of people over 65 expected to account for 20% of the island's total population by 2025. The island runs a trade surplus, largely because of its surplus with China, and its foreign reserves are the world's fourth largest, behind those of China, Japan, and Russia. In 2006 China overtook the US to become Taiwan's second-largest source of imports after Japan. China is also the island's number one destination for foreign direct investment. Taiwan since 2009 has gradually loosened rules governing Chinese investment on the island, and has also secured greater market access for its investors in the mainland. In August 2012, the Taiwan Central Bank signed a memorandum of understanding on cross-Strait currency settlement with its Chinese counterpart. The MOU allows for the direct settlement of Chinese RMB and the New Taiwan dollar across the Strait, which has helped Taiwan develop into a local RMB hub. Closer economic links with the mainland bring greater opportunities for the Taiwan economy, but also pose new challenges as the island becomes more economically dependent on China at a time when political differences remain unresolved. During 2014, the press paid increasing attention to domestic economic issues while pushing aside the debates over trade liberalization that were a hallmark of MA’s tenure. The media focused on the divide between Taiwan’s “haves” and “have nots,” providing extensive coverage of public frustration with stagnant wages, skyrocketing housing prices, and the difficulty of finding entry-level jobs.

Source : CIA

Contact Points

Company Name:	Taita Chemical Co., Ltd.
Supplied Name:	TAITA CHEMICAL COMPANY, LIMITED KAOHSIUNG BRANCH
Trading Address:	12F., No.37 Ji-Hu Rd., Nei-Hu Dist., Taipei, Taiwan
Supplied Address:	NO.5 INDUSTRIAL 1ST RD., LINYUAN DIST.,KAOHSIUNG, TAIWAN.
Telephone Number:	+886-2-8751-6888/2658-2158
Fax Number:	+886-2-2659-9520

Notes: The exact name and address is as above. The supplied name is subject’s branch name. The supplied address belongs to subject’s branch address.

Company Identification Details

Registered Name:	Taita Chemical Co., Ltd.
Registered Address:	12F., No.37 Ji-Hu Rd., Nei-Hu Dist., Taipei, Taiwan
Date of Foundation:	1960-4-6
Registration Number:	11893409
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 3,276,518,550 (USD 106,486,852.88) (As of 2015.6, 1 NTD = 0.0325 USD)
Paid-up Capital:	NTD 3,276,518,550 (USD 106,486,852.88)
Legal Representatives:	Yigui Wu
Legal Form:	Joint Stock Company
Principal Activities:	Manufacturing and sale of chemicals, etc.
Staff:	About 400 Employees
Listed at Stock Exchange:	Yes; Stock Symbol: 1309
Date of Last Annual Return:	2014-6-25

History

Subject was incorporated on 1960-4-6 with registered number 11893409 as Joint Stock Company in Taiwan.

Subject listed on Taiwan Stock Exchange on 1986-6-27.

Corporate Structure

Factories

1
Address:	No. 3, Jianji Rd., Qianzhen Dist., Kaohsiung City, Taiwan
Date of Registration:	1965-12-1
Factory Registration Number:	64000067
Factory Manager:	Qinglong Li
Status:	In Production
Date of Last Annual Return:	2014-3-14
Major Products:	184 synthetic resin, plastics and rubber. 220 rubber products
2
Name:	Linyuan Factory
Address:	No. 5, Industrial 1st Rd., Linyuan Dist., Kaohsiung City, Taiwan
Date of Foundation:	1982-2-22
Date of Registration:	1990-12-31
Factory Registration Number:	99661848
Factory Manager:	Zhihong Liu
Status:	In Production
Date of Last Annual Return:	2014-5-20
Major Products:	184 synthetic resin, plastics and rubber.
3
Name:	Toufen Factory
Address:	No. 571, Minzu Rd., Lin 17, Tianliao Li, Toufen Town, Miaoli County, Taiwan
Date of Foundation:	1991-1-25
Date of Registration:	1992-8-5
Factory Registration Number:	99631806
Factory Manager:	Shengpeng Chen
Status:	In Production
Date of Last Annual Return:	2007-12-19
Major Products:	161 Printing and assistive products 231 glass and related products

Branch

Name	Taita Chemical Company, Limited Kaohsiung Branch
Address	No. 5, Industrial 1st Rd., Linyuan Dist., Kaohsiung City, Taiwan
Registration Number	54388606
Date of Registration	2014-8-26
Status	Active
Manager Name	Baoluo Ying
Date of Last Annual Return	--

Group Companies

1
Name	USI Corporation
2
Name	Asia Polymer Corporation
3
Name	Acme Electronics Corporation
4
Name	Taiwan VCM Corporation

Shareholders

Major Shareholders

Name	Subscription Shares
Lianju International Investment Co., Ltd. (Literal Translation)
120,159,750
Tailian International Investment Co., Ltd. (Literal Translation)	29,981,137

Management Information

Core Management

Directors

1
Name		Yigui Wu
Position		Chairman of the Board
2
Name	Fengqiang Miao
Position		Director
3
Name	Hantai Liu
Position		Director
4
Name	Xinhuai Zhou
Position		Director
5
Name	Baoluo Ying
Position		Director & Manager
Date of Appointment		2008-9-30
6
Name	Yishao Ke
Position		Director
7
Name	Zhentu Liu
Position		Director
8
Name	Shengquan Wu
Position		Supervisor
9
Name	Zhaoan Wang
Position		Supervisor

Personnel Structure

Total Employees

About 400 Employees

Operation Information

Offices & Factories

	Headquarters
Add	12F., No.37 Ji-Hu Rd., Nei-Hu Dist., Taipei, Taiwan

Production Information

Subject is engaged in manufacturing of chemicals

Subject has factories in Taiwan for production.

It is introduced that subject has factories in Zhongshan City and Tianjin City of the Mainland of China for production.

Subject obtained the certification of ISO 9001, ISO 14001, OHSAS 18001.

Purchase Information

The registered activities of subject:

Business Code	Details
--	Manufacturing and sale of polystyrene and processed products
--	Manufacturing and sale of propylene, butadiene, styrene copolymer resin
--	Manufacturing and sale of propylene, butadiene, styrene copolymer resin
--	Manufacturing and sale of glass cotton and related products
--	Manufacturing and sale of rubber raw materials and processing products
E303020	Noise and vibration control engineering
E801010	Interior decorating business
ZZ99999	Besides licensed business, all other business items those are not banned or restricted.

The raw materials for production are mostly purchased at home.

Sales Information

Subject is engaged in sale of chemicals

The major products are ABS, GPPS, and EPS, as well as Glass Wool and Cubic Printing

Subject’s sales regions are domestic market, Japan, India, Southeast Asia, America, Europe

Subject’s major customers are manufacturers of chemical products

Import and export right:

Import right	Yes
Export right	Yes

Settlements

Purchase

Domestic Purchase

Products	Raw materials
Payment Terms	T/T, Cash

Import

Subject has little import.

Sales

Domestic Markets

Product	Chemicals
Selling Terms	T/T, Cash

Export

Product	Chemicals
Selling Terms	L/C, T/T

Balance Sheet

Unit: NTD/000

Consolidated	2014-12-31	2013-12-31
Assets
Current assets
Cash and cash equivalents
Total cash and cash equivalents	910,720	1,236,102
Current financial assets at fair value through profit or loss
Total current financial assets at fair value through profit or loss	395,552	287,133
Current bond investment without active market
Current bond investment without active market, net	508,811	270,897
Notes receivable, net
Notes receivable, net	1,513,826	2,018,228
Accounts receivable, net
Accounts receivable, net	1,977,140	1,796,479
Accounts receivable due from related parties, net
Accounts receivable due from related parties, net	36,489	0
Other receivables
Other receivables, net	101,260	85,217
Other receivables due from related parties
Other receivables due from related parties, net	3,748	3,937
Inventories
Total inventories	1,725,667	2,779,319
Prepayments
Total prepayments	93,891	157,848
Other current assets
Total other current assets	241	920
Total current assets	7,267,345	8,636,080
Non-current assets
Non-current available-for-sale financial assets
Non-current available-for-sale financial assets, net	257,901	304,670
Non-current financial assets at cost
Non-current financial assets at cost, net	8,753	10,653
Investments accounted for using equity method
Investments accounted for using equity method, net	499,837	504,896
Property, plant and equipment
Total property, plant and equipment	2,595,052	2,614,121
Investment property, net
Investment property, net	108,178	108,178
Intangible assets
Total intangible assets	22,367	9,725
Deferred tax assets	181,859	164,406
Other non-current assets
Long-term prepaid rents	46,344	45,134
Other non-current assets, others
Total other non-current assets, others	5,141	2,588
Total other non-current assets	51,485	47,722
Total non-current assets	3,725,432	3,764,371
Total assets	10,992,777	12,400,451
Liabilities
Current liabilities
Short-term borrowings
Total short-term borrowings	3,560,145	3,682,248
Short-term notes and bills payable
Total short-term notes and bills payable	599,844	399,831
Current financial liabilities at fair value through profit or loss
Total current financial liabilities at fair value through profit or loss	359	186
Notes payable
Total notes payable	47,322	61,693
Accounts payable
Total accounts payable	892,572	2,088,978
Accounts payable to related parties
Total accounts payable to related parties	788	1,508
Other payables
Total other payables	238,415	232,613
Other payables to related parties	24,732	23,797
Current tax liabilities	957	957
Current provisions
Total current provisions	2,024	2,164
Other current liabilities
Other current liabilities, others	39,353	25,783
Total other current liabilities	39,353	25,783
Total current liabilities	5,406,511	6,519,758
Non-current liabilities
Long-term borrowings
Total long-term borrowings	1,300,000	1,000,000
Deferred tax liabilities
Total deferred tax liabilities	207,777	186,906
Other non-current liabilities
Accrued pension liabilities	599,348	593,544
Other non-current liabilities, others	8,567	8,050
Total other non-current liabilities	607,915	601,594
Total non-current liabilities	2,115,692	1,788,500
Total liabilities	7,522,203	8,308,258
Equity
Equity attributable to owners of parent
Share capital
Ordinary share	3,276,518	3,276,518
Total capital stock	3,276,518	3,276,518
Capital surplus
Total capital surplus	483	493
Retained earnings
Legal reserve	97,174	95,436
Special reserve	308,061	308,061
Unappropriated retained earnings (accumulated deficit)
Total unappropriated retained earnings (accumulated deficit)	-520,659	119,177
Total retained earnings	-115,424	522,674
Other equity interest
Total other equity interest	308,997	292,508
Total equity attributable to owners of parent	3,470,574	4,092,193
Total equity	3,470,574	4,092,193
Number of share capital awaiting retirement	0	0
Equivalent issue shares of advance receipts for ordinary share	0	0
Number of shares in entity held by entity and by its subsidiaries	0	0

Profit and Loss Account

Unit: NTD/000

Consolidated	2014	2013
Operating revenue
Net sales revenue
Net sales revenue	20,933,816	21,438,961
Total operating revenue	20,933,816	21,438,961
Operating costs
Cost of sales
Total cost of sales	20,855,152	20,930,084
Total operating costs	20,855,152	20,930,084
Gross profit (loss) from operations	78,664	508,877
Gross profit (loss) from operations	78,664	508,877
Operating expenses
Selling expenses
Total selling expenses	516,681	477,683
Administrative expenses
Total administrative expenses	190,447	179,333
Research and development expenses
Total research and development expenses	19,483	23,209
Total operating expenses	726,611	680,225
Net operating income (loss)	-647,947	-171,348
Non-operating income and expenses
Other income
Total other income	92,806	101,317
Other gains and losses
Other gains and losses, net	16,229	109,900
Finance costs
Interest expense	103,036	57,197
Finance costs, net	103,036	57,197
Share of profit (loss) of associates and joint ventures accounted for using equity method
Share of profit (loss) of associates and joint ventures accounted for using equity method, net	3,738	32,202
Total non-operating income and expenses	9,737	186,222
Profit (loss) from continuing operations before tax	-638,210	14,874
Tax expense (income)
Total tax expense (income)	-7,024	-2,509
Profit (loss) from continuing operations	-631,186	17,383
Profit (loss)	-631,186	17,383
Other comprehensive income
Exchange differences on translation	81,014	115,717
Unrealized gains (losses) on valuation of available-for-sale financial assets	-46,671	-36,560
Actuarial gains (losses) on defined benefit plans	-8,119	-20,684
Share of other comprehensive income of associates and joint ventures accounted for using equity method
Total share of other comprehensive income of associates and joint ventures accounted for using equity method	-4,255	5,689
Income tax related to components of other comprehensive income	12,392	16,296
Other comprehensive income, net	9,577	47,866
Total comprehensive income	-621,609	65,249
Profit (loss), attributable to:
Profit (loss), attributable to owners of parent	-631,186	17,383
Comprehensive income attributable to:
Comprehensive income, attributable to owners of parent	-621,609	65,249
Basic earnings per share
Total basic earnings per share	-1.93	0.05
Diluted earnings per share
Total diluted earnings per share	-1.93	0.05

Cash Flows

Unit: NTD/000

Consolidated	2014	2013
Cash flows from (used in) operating activities, indirect method
Profit (loss) from continuing operations before tax	-638,210	14,874
Profit (loss) before tax	-638,210	14,874
Adjustments
Adjustments to reconcile profit (loss)
Depreciation expense	215,412	170,457
Amortization expense	3,361	185
Provision (reversal of provision) for bad debt expense	348	-3,556
Net loss (gain) on financial assets or liabilities at fair value through profit or loss	5,241	-29,416
Interest expense	103,036	57,197
Interest income	-44,562	-34,776
Dividend income	-8,714	-15,832
Share of loss (profit) of associates and joint ventures accounted for using equity method	-3,738	-32,202
Loss (gain) on disposal of property, plan and equipment	-106	-84
Loss (gain) on disposal of investments	31	313
Impairment loss on non-financial assets	76,824	47,043
Unrealized foreign exchange loss (gain)	7,114	-13,785
Other adjustments to reconcile profit (loss)	1,345	1,307
Total adjustments to reconcile profit (loss)	355,592	146,851
Changes in operating assets and liabilities
Changes in operating assets
Decrease (increase) in financial assets held for trading	-109,348	173,039
Decrease (increase) in notes receivable	504,402	-291,643
Decrease (increase) in accounts receivable	-195,352	-441,740
Decrease (increase) in accounts receivable due from related parties	-36,489	0
Decrease (increase) in other receivable	-15,587	-11,782
Decrease (increase) in other receivable due from related parties	189	1,031
Decrease (increase) in inventories	973,483	-1,054,074
Decrease (increase) in prepayments	67,574	-20,301
Decrease (increase) in other current assets	679	7,579
Total changes in operating assets	1,189,551	-1,637,891
Changes in operating liabilities
Increase (decrease) in notes payable	-14,371	38,823
Increase (decrease) in accounts payable	-1,196,406	922,190
Increase (decrease) in accounts payable to related parties	-720	416
Increase (decrease) in other payable	23,291	18,700
Increase (decrease) in other payable to related parties	935	-3,192
Increase (decrease) in provisions	13,193	11,719
Increase (decrease) in other current liabilities	13,570	16,196
Increase (decrease) in accrued pension liabilities	-2,315	1,688
Total changes in operating liabilities	-1,162,823	1,006,540
Total changes in operating assets and liabilities	26,728	-631,351
Total adjustments	382,320	-484,500
Cash inflow (outflow) generated from operations	-255,890	-469,626
Interest received	44,994	35,034
Interest paid	-101,495	-55,351
Income taxes refund (paid)	-888	-640
Net cash flows from (used in) operating activities	-313,279	-490,583
Cash flows from (used in) investing activities
Acquisition of available-for-sale financial assets	-284	0
Proceeds from disposal of available-for-sale financial assets	351	0
Acquisition of bond investments without active market	-2,427,843	-1,762
Proceeds from disposal of bond investments without active market	2,215,907	0
Proceeds from capital reduction of financial assets at cost	2,250	5,309
Proceeds from disposal of investments accounted for using equity method	0	19,785
Acquisition of property, plant and equipment	-201,099	-565,577
Proceeds from disposal of property, plant and equipment	449	445
Increase in refundable deposits	-1,812	0
Acquisition of intangible assets	0	-1,503
Increase in other non-current assets	-553	-194
Dividends received	15,854	19,200
Net cash flows from (used in) investing activities	-396,780	-524,297
Cash flows from (used in) financing activities
Increase in short-term loans	0	1,214,735
Decrease in short-term loans	-129,217	0
Increase in short-term notes and bills payable	200,000	200,000
Proceeds from long-term debt	4,794,000	4,400,000
Repayments of long-term debt	-4,494,000	-4,300,000
Increase in other non-current liabilities	517	3,413
Net cash flows from (used in) financing activities	371,300	1,518,148
Effect of exchange rate changes on cash and cash equivalents	13,377	71,617
Net increase (decrease) in cash and cash equivalents	-325,382	574,885
Cash and cash equivalents at beginning of period	1,236,102	661,217
Cash and cash equivalents at end of period	910,720	1,236,102
Cash and cash equivalents reported in the statement of financial position	910,720	1,236,102

Note: Subject didn’t submit its individual financial information; we obtained its consolidated financials as above for reference.

The above financial figures are based on the IFRSs Accounting System.

Bankers

Subject declined to disclose its bank details; from other source we could not obtain the relevant information, either.

Public Record

Mortgage

No chattel mortgage record of subject has been found within the recent 3 months.

Lawsuit

Up to date of reporting, no existing or latent litigation of the subject has been found.

Special Note

Interview Details

Name	Mr. Ke
Department	Sales Department

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.63.94
UK Pound	1	Rs.98.27
Euro	1	Rs.72.37

INFORMATION DETAILS

Analysis Done by :	RAS
Report Prepared by :	ANK

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.