MIRA INFORM REPORT

Report No. :	324847
Report Date :	30.05.2015

IDENTIFICATION DETAILS

Name :	CHANGZHOU DAHUA IMPORT & EXPORT (GROUP) CORP., LTD.

Registered Office :	8-10/F, Hengyuan Building, No. 180 Guanhe West Road, Changzhou, Jiangsu Province 213002 Pr

Country :	China

Financials (as on) :	31.12.2013

Date of Incorporation :	05.02.1997

Com. Reg. No.:	320400000017627

Legal Form :	Limited Liabilities Company

Line of Business :	Subject engaged in trading different kinds of products. Main Products: Light industry Arts & Crafts Textile & Garments Machinery and Electronic Chemicals: Medical Chemicals

No. of Employee :	120

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 – 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; (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 2014 more than 274 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.

Source : CIA

company name address

CHANGZHOU DAHUA IMPORT & EXPORT (GROUP) cORP., Ltd.

8-10/F, HENGYUAN BUILDING, NO. 180 GUANHE WEST ROAD,

CHANGZHOU, JIANGSU PROVINCE 213002 PR CHINA

TEL: 86 (0) 519-86183130/86183161/86183129/86183021

FAX: 86 (0) 519-86183150/86183092

EXECUTIVE SUMMARY

INCORPORATION DATE : fEB. 5, 1997

REGISTRATION NO. : 320400000017627

REGISTERED LEGAL FORM : LIMITED LIABILITIES COMPANY

CHIEF EXECUTIVE : MR. ling zixue (chairman)

STAFF STRENGTH : 120

REGISTERED CAPITAL : CNY 20,000,000

BUSINESS LINE : TRADING

TURNOVER : CNY 1,842,220,000 (UNAUDITED, AS OF DEC. 31, 2013)

EQUITIES : CNY 67,900,000 (UNAUDITED, AS OF DEC. 31, 2013)

PAYMENT : AVERAGE

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : FAIRLY STABLE

OPERATIONAL TREND : STEADY

GENERAL REPUTATION : AVERAGE

EXCHANGE RATE : CNY 6.20 = USD 1 AS

Adopted abbreviations:

ANS - amount not stated

NS - not stated

SC - subject company (the company inquired by you)

NA - not available

CNY - China Yuan Renminbi

Note: SC’s detailed address should be the heading one.

SC was registered as a limited liabilities company at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on Feb. 5, 1997.

Company Status: Limited liabilities co.

This form of business in PR China is defined as a legal person. No more than fifty shareholders contribute its registered capital jointly. Shareholders bear limited liability to the extent of shareholding, and the co. is liable for its debts only to extent of its total assets. The characteristics of this form of co. are as follows:

Upon the establishment of the co., an investment certificate is issued to the each of shareholders.

The board of directors is comprised of three to thirteen members.

The minimum registered capital for a co. is CNY 30,000.

Shareholders may take their capital contributions in cash or by means of tangible assets or intangible assets such as industrial property and non-patented technology.

Cash contributed by all shareholders must account for at least 30% of the registered capital.

Existing shareholders have pre-exemption right to purchase shares of the co. offered for sale by the other shareholders and to subscribe for the newly increased registered capital of the co.

SC’s registered business scope includes selling various stereotype food; importing and exporting commodities and technologies, excluding export commodities under state-unified operation and import commodities operated by the state-designated companies, processing with imported materials, processing with imported samples, assembling with imported parts, and compensation trade in agreement; purchasing, transferring and storing export sources; domestic trade, economic technology exchange and consulting services; selling industrial manufacture materials (excluding special items).

SC is mainly engaged in trading different kinds of products.

Mr. Ling Zixue has been legal representative, chairman and general manager of SC since 1997.

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

SC is currently operating at the above stated address, and this address houses its operating office in the commercial zone of Changzhou. SC’s accountant refused to release the detailed information of the area.

Note: SC’s present address “No. 180 Guanhe West Road” was formerly named as “No. 1, Changxin Road”.

http://www.dahuagroup.com.cn The design is professional and the content is well organized. At present it is in Chinese version.

http://www.dahuacorp.com/ The design is professional and the content is well organized. At present it is in Chinese and English versions.

Email: jiangbo@dahuagroup.com.cn

Changes of its registered information:

Date of change	Item	Before the change	After the change
2003	Registered capital	CNY 10,000,000	CNY 8,000,000
2005	Registered capital	CNY 8,000,000	CNY 16,000,000
Unknown	Registered no.	3204002103290	Present one
2011-6-27	Registered capital	CNY 16,000,000	CNY 20,000,000
Unknown	Shareholders	Labor Union of Changzhou Dahua Imp. & Exp. (Group) Corp., Ltd. 27.63% Ling Zixue 9.27% Chen Zhijian 8.51% Dong Qiangsheng 4.52% Xu Ning 5.56% Zhu Mingjuan 3.17% Xu Jie 2.81% Hua Hao 2.25% Zhou Xuhua 2.30% Tan Limin 4.52% Other 26 individual shareholders 29.46%	Labor Union of Changzhou Dahua Imp. & Exp. (Group) Corp., Ltd. 28.39% Ling Zixue 9.27% Chen Zhijian 8.51% Dong Qiangsheng 4.52% Xu Ning 5.56% Zhu Mingjuan 3.17% Xu Jie 2.81% Hua Hao 2.25% Zhou Xuhua 2.30% Tan Limin 4.52% Other 25 individual shareholders 25 28.70%
2014	Shareholders	Labor Union of Changzhou Dahua Imp. & Exp. (Group) Corp., Ltd. 28.39% Ling Zixue 9.27% Chen Zhijian 8.51% Dong Qiangsheng 4.52% Xu Ning 5.56% Zhu Mingjuan 3.17% Xu Jie 2.81% Hua Hao 2.25% Zhou Xuhua2.30% Tan Limin 4.52% Other 25 individual shareholders 28.70%	Present ones

SC is entitled as national “High-integrity Enterprise”, “AAA Company of China Chamber of Commerce for Import & Export of Textile”, “Top 100 service industry company in Jiangsu Province”, “A-Class Company of Changzhou Tax Bureau”. In year 2002, Dahua Group obtained the Quality System Certificate of ISO9001.

Subject passed the annual inspection of 2012 with Administration for Industry & Commerce.

Organization Code: 137202930

There is no record of litigation till now.

MAIN SHAREHOLDERS:

Name Amount (CNY) % of Shareholding

Labor Union of Changzhou

Dahua Imp. & Exp. (Group) Corp., Ltd. 2,302,159.49 11.51

Chen Zhijian 1,846,630.07 9.23

Ling Zixue 1,838,127.71 9.19

Xu Ning 1,128,153.03 5.64

Zhu Mingjuan 906,912.87 4.53

Dong Qiangsheng 896,647.65 4.48

Tan Limin 896,647.65 4.48

Chen Baomin 689,960.15 3.45

Xu Jie 557,257.08 2.79

Hua Hao 460,832.72 2.30

Other 40 individual shareholders 8,476,671.58 42.38

Legal representative, chairman and general manager:

Mr. Ling Zixue, born in 1965 with vocational secondary school education. He is currently responsible for the overall management of SC.

Working Experience(s):

From 1997 to present Working in SC as legal representative, chairman and general manager

Also working in Jiangsu Huamaotong Import and Export Service Co., Ltd. as legal representative.

Directors:

Tan Limin

Xu Ning

Xu Jie

ID# 32010619661224XXXX

Supervisors:

Shen Xiaoyang

Hua Hao

Lin Yuehua

SC is mainly engaged in trading different kinds of products.

Main Products:

Light industry:

Tent

Disposable paper plastic products

Protectors for sports

Glass

Shoes

Cases and Bags

Lifesaving equipment

Arts & Crafts:

Doll Dress

Toys

Dollhouse Furniture

Textile & Garments:

Other Textiles

Garments

Fabrics

Home Textile

Hotel Textile

Machinery and Electronic:

Motors

Electronic Products

Auto accessories

Machinery Parts

Chemicals:

Agrochemicals

Daily Chemicals

Organically Chemicals

Inorganic Chemicals

Medical Chemicals:

Medical items

Food additives

Pharmaceutical Ingredients

API

Others:

Building Material

Thermometer

Fire Equipment

SC sources its materials 90% from domestic market and 10% from overseas market. SC sells 10% of its products in domestic market, and 90% to overseas 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.

Note: SC refused to release its major clients and suppliers.

TRADEMARKS & PATENTS

Registration No.	6055404	4639660	11805925
Registration Date	Jan. 7, 2010	Jan. 14, 2010	May 7, 2014
Trademark Design

Changzhou Zhiye Medical Devices Institute Co., Ltd.

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

Registration no.: 320483000004753

Registered capital: CNY 15,000,000

Legal representative: Shen Pei

Tel: 0519-86707185

Fax: 0519-86707186

Address: No. 127, Xiacheng Road, Wujin District, Changzhou, Jiangsu 127

Email: info@cnzhiye.cn

http://www.cnzhiye.cn/

SC is known to have the following subsidiaries:

Changzhou Huaou Imp. & Exp. Co., Ltd.

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

Registration no.: 320404000082974

Registered capital: CNY 510,000

Legal representative: Tan Limin

Hong Kong Dahua International Development Group Limited

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

Registration no.: 1142266

Legal form: private company limited by shares

Incorporation date: 2007-6-18

Jiangsu Huamaotong Import and Export Service Co., Ltd.

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

Registration no.: 320400000049176

Incorporation date: 2014-02-17

Legal representative: Ling Zixue Registered capital: CNY 5,000,000

Tel: 0519-80582345

Fax: 0519-80582353

http://www.huamaotouch.com/

Overall payment appraisal :

( ) Excellent ( ) Good (X) Average ( ) Fair ( ) Poor ( ) Not yet 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.

Bank of China Changzhou Branch

AC#：N/A

Relationship: Normal.

Financial Summary

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

Unit: CNY’000

	As of Dec. 31, 2013
Current assets	717,800
Total assets	734,270
	=========
Current liabilities	666,070
Long term liabilities	300
	--------------
Total liabilities	666,370
Equities	67,900
	--------------
Total liabilities & equities	734,270
	=========
Turnover	1,842,220
Cost of goods sold	1,777,490
Profit before tax	23,240
Less: profit tax	5,560
Profits	17,680

Note: SC’s management refused to release its detailed financial reports, and the Financial Report for Year 2013 hasn’t been audited.

Important Ratios

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

	as of Dec. 31, 2013
*Current ratio	1.08
*Quick ratio	/
*Liabilities to assets	0.91
*Net profit margin (%)	0.96
*Return on total assets (%)	2.41
*Inventory /Turnover ×365	/
*Accounts receivable/Turnover ×365	/
*Turnover/Total assets	2.51
* Cost of goods sold/Turnover	0.96

PROFITABILITY: AVERAGE

The turnover of SC appears good in its line.

SC’s net profit margin is average.

SC’s return on total assets is average.

SC’s cost of goods sold is high, comparing with its turnover.

LIQUIDITY: AVERAGE

The current ratio of SC is maintained in a normal level.

SC’s turnover is in a fairly good level, comparing with the size of its total assets.

LEVERAGE: FAIR

The debt ratio of SC is high.

The risk for SC to go bankrupt is average.

Overall financial condition of the SC: Fairly stable.

SC is considered medium-sized in its line with fairly stable financial conditions.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.63.76
UK Pound	1	Rs.97.80
Euro	1	Rs.69.91

INFORMATION DETAILS

Analysis Done by :	DIV

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.