MIRA INFORM REPORT

Report No. :	341641
Report Date :	22.09.2015

IDENTIFICATION DETAILS

Name :	CGPC POLYMER CORPORATION
Registered Office :	12F., No.37, Jihu Rd., Neihu Dist., Taipei City 11492, (R.O.C.)
Country :	Taiwan
Financials (as on) :	31.12.2014
Date of Incorporation :	19.05.2009
Com. Reg. No.:	24347565
Legal Form :	Joint Stock Company
Line of Business :	Manufacturing and Sale of Polyvinyl Chloride (PVC) Powders.
No. of Employees :	About 100 Employees (Company) About 900 Employees (Group)

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 – March 31, 2015

Country Name	Previous Rating (31.12.2014)	Current Rating (31.03.2015)
Taiwan	A1	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. 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, follow-on components of the ECFA, including a signed agreement on trade in services and negotiations on trade in goods and dispute resolution, have stalled. In early 2014, the government bowed to public demand and proposed 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 nearly 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 fifth largest, behind those of China, Japan, Saudi Arabia, and Switzerland. 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 (MOU) 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 Taiwan’s 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 decent entry-level jobs.

Source : CIA

Contact Points

Company Name:	CGPC Polymer Corporation
Supplied Name:	CGPC POLYMER CORPORATION KAOHSIUNG
Trading Address:	12F., No.37, Jihu Rd., Neihu Dist., Taipei City 11492, Taiwan (R.O.C.)
Supplied Address:	BRANCH NO 8 SHIHUA 2ND ROADLINYUAN DIST.KAOHSIUNG TAIWAN
Telephone Number:	+886-2-8751-6888/ 2658-2158
Fax Number:	+886-2-2659-9519

Notes: The exact name and address are as above. The supplied name and address belong to subject’s Kaohsiung branch. (The supplied address also belongs to subject’s Linyuan factory)

Company Identification Details

Registered Name:	CGPC Polymer Corporation
Registered Address:	12F., No.37, Jihu Rd., Neihu Dist., Taipei City 11492, Taiwan (R.O.C.)
Date of Foundation:	2009-5-19
Registration Number:	24347565
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 800,000,000 (USD 24,480,000) (As of 2015.09, 1 NTD = 0.0306 USD)
Paid-up Capital:	NTD 500,000,000 (USD 15,300,000)
Legal Representatives:	Yigui Wu
Legal Form:	Joint Stock Company
Principal Activities:	Manufacturing and sale of polyvinyl chloride (PVC) powders
Staff:	About 100 Employees (Company) About 900 Employees (Group)
Listed at Stock Exchange:	No
Date of Last Annual Return:	2015-6-2

History

Subject was incorporated on 2009-5-19 with registered number 24347565 as Joint Stock Company in Taiwan.

Corporate Structure

Factory

Name:	Linyuan Factory
Address:	No.6, 8, Shihua 2nd Rd., Linyuan Dist., Kaohsiung, Taiwan
Date of Registration:	2011-8-19
Factory Registration Number:	64006350
Factory Manager:	Peihong Cai
Status:	In Production
Date of Last Annual Return:	2014-12-7
Major Products:	184 synthetic resin, plastic and rubber

Branch

Name	CGPC Polymer Corporation Kaohsiung Branch
Address	No.8, Shihua 2nd Rd., Linyuan Dist., Kaohsiung, Taiwan
Registration Number	54385853
Date of Registration	2014-7-10
Status	Live
Manager Name	Hanfu Lin
Date of Last Annual Return	2014-7-10

Parent Company

Registered Name:	China General Plastics Corp.
Registered Address:	12^th Floor, No.37, Ji-Hu Road, Nei-Hu Dist., Taipei City, Taiwan, R.O.C.
Date of Foundation:	1964-4-29
Registration Number:	11686106
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 5,000,000,000 (USD 153,000,000) (As of 2015.09, 1 NTD = 0.0306 USD)
Paid-up Capital:	NTD 4,683,034,080 (USD)
Legal Representatives:	Yigui Wu
Legal Form:	Joint Stock Company
Listed at Stock Exchange:	Yes; Stock Code: 1305
Date of Listed:	1973-3-5
Date of Last Annual Return:	2015-7-13

Major Related Companies

1
Name:	CGPC America Corporation
Address:	11310 HARREL ST. MIRA LOMA CA 91752-1408 U.S.A.
Tel:	+909-594-0080
Fax:	+909-594-0062
2
Name:	China General Plastics (Hong Kong) Co., Ltd.
Address:	Rm. 1110B. Tower 2, China H.K. City, 33 Canton Rd., Tsim Sha Tsui, Kln, Hong Kong

Shareholders

Major Shareholders

Name	Subscription Shares
China General Plastics Corp.
50,000,000

Management Information

Core Management

Directors

1
Name		Yigui Wu
Position		Board Chairman
2
Name	Bingyi Wang
Position		Director
3
Name	Hanfu Lin
Position		Director & Manager
Appointment Date of Manager		2012-5-11
4
Name	Yayi Huang
Position		Supervisor

Operation Information

	Headquarters
Add	12F., No.37, Jihu Rd., Neihu Dist., Taipei City 11492, Taiwan (R.O.C.)

Production Information

Subject is engaged in manufacturing of polyvinyl chloride (PVC) powders, etc.

Subject has a factory in Kaohsiung, Taiwan for production.

Subject obtained ISO 9001 certification.

Purchase Information

The registered activities of subject:

Business Code	Details
C801020	Manufacturing of petrochemical materials
C805010	Manufacturing of plastic leather, cloth, plate and tube
F107200	Wholesale of chemical raw materials
F107990	Wholesale of other chemical products
F207200	Retail of chemical raw materials
F207990	Retail of other chemical products
C801100	Manufacturing of synthetic resin and plastic
ZZ99999	Besides licensed business, all other business items those are not banned or restricted.

The raw materials for production are mostly purchased in domestic market.

Sales Information

Subject is engaged in sale of polyvinyl chloride (PVC) powders, etc.

The major products sold by the subject are applied in the manufacturing of tubular product, synthetic fibers, paper pulps, shoes, automobile products, wires, construction materials, toys and household products, etc.

Subject’s sales regions cover domestic and overseas markets.

One of subject’s customers is GNB Import Export SA.

Import and export right:

Import right	Yes
Export right	Yes

Settlements

Purchase

Domestic Purchase

Products	Raw materials
Payment Terms	Cash, T/T, etc.

Import

Subject has little import.

Sales

Domestic Markets

Product	Polyvinyl chloride (PVC) powders, etc.
Selling Terms	Cash, T/T, etc.

Export

Product	Polyvinyl chloride (PVC) powders, etc.
Selling Terms	T/T, etc.

Balance Sheet

Unit: NTD/000

Consolidated	2014-12-31	2013-12-31 (Restated)
Assets
Current assets
Cash and cash equivalents
Total cash and cash equivalents	760,429	928,585
Current financial assets at fair value through profit or loss
Total current financial assets at fair value through profit or loss	481,646	1,018,538
Current available-for-sale financial assets
Current available-for-sale financial assets, net	3,291	3,551
Current bond investment without active market
Current bond investment without active market, net	412,602	207,924
Notes receivable, net
Notes receivable, net	190,766	145,583
Accounts receivable, net
Accounts receivable, net	1,074,566	1,075,492
Accounts receivable due from related parties, net
Accounts receivable due from related parties, net	65,194	147,573
Other receivables
Other receivables, net	63,615	53,953
Other receivables due from related parties
Other receivables due from related parties, net	22,981	22,179
Current tax assets
Total current tax assets	22,720	0
Inventories
Total inventories	2,072,603	1,682,277
Prepayments
Total prepayments	167,880	116,302
Other current assets
Total other current assets	2,116	43,505
Total current assets	5,340,409	5,445,462
Non-current assets
Non-current available-for-sale financial assets
Non-current available-for-sale financial assets, net	2,488	2,690
Non-current financial assets at cost
Non-current financial assets at cost, net	103,190	3,004
Investments accounted for using equity method
Investments accounted for using equity method, net	289,322	291,918
Property, plant and equipment
Total property, plant and equipment	5,106,533	5,203,400
Investment property, net
Investment property, net	27,715	27,715
Intangible assets
Total intangible assets	32,452	37,530
Deferred tax assets	320,727	321,382
Other non-current assets
Long-term prepaid rents	125,354	122,133
Other non-current assets, others
Total other non-current assets, others	20,040	36,271
Total other non-current assets	145,394	158,404
Total non-current assets	6,027,821	6,046,043
Total assets	11,368,230	11,491,505
Liabilities
Current liabilities
Short-term borrowings
Total short-term borrowings	500,000	200,000
Short-term notes and bills payable
Total short-term notes and bills payable	599,701	124,929
Current financial liabilities at fair value through profit or loss
Total current financial liabilities at fair value through profit or loss	62	106
Notes payable
Total notes payable	346	262
Accounts payable
Total accounts payable	615,647	812,923
Accounts payable to related parties
Total accounts payable to related parties	26,978	53,082
Other payables
Total other payables	510,473	544,781
Other payables to related parties	9,177	14,290
Current tax liabilities	0	149,560
Current provisions
Total current provisions	17,033	21,196
Other current liabilities
Long-term liabilities, current portion
Total long-term liabilities, current portion	176,411	127,612
Other current liabilities, others	46,197	40,188
Total other current liabilities	222,608	167,800
Total current liabilities	2,502,025	2,088,929
Non-current liabilities
Long-term borrowings
Total long-term borrowings	790,781	1,085,763
Deferred tax liabilities
Total deferred tax liabilities	600,956	602,837
Other non-current liabilities
Accrued pension liabilities	1,391,849	1,393,880
Other non-current liabilities, others	4,297	7,277
Total other non-current liabilities	1,396,146	1,401,157
Total non-current liabilities	2,787,883	3,089,757
Total liabilities	5,289,908	5,178,686
Equity
Equity attributable to owners of parent
Share capital
Ordinary share	4,683,034	4,502,917
Total capital stock	4,683,034	4,502,917
Capital surplus
Total capital surplus	8,232	8,239
Retained earnings
Legal reserve	153,013	77,701
Special reserve	408,223	408,223
Unappropriated retained earnings (accumulated deficit)
Total unappropriated retained earnings (accumulated deficit)	502,304	1,023,408
Total retained earnings	1,063,540	1,509,332
Other equity interest
Total other equity interest	58,473	30,087
Treasury shares	0	0
Total equity attributable to owners of parent	5,813,279	6,050,575
Equity attributable to former owner of business combination under common control	0	0
Non-controlling interests	265,043	262,244
Total equity	6,078,322	6,312,819
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 (Restated)
Operating revenue
Net sales revenue
Net sales revenue	14,559,831	14,191,319
Total operating revenue	14,559,831	14,191,319
Operating costs
Cost of sales
Total cost of sales	13,422,934	12,228,005
Total operating costs	13,422,934	12,228,005
Gross profit (loss) from operations	1,136,897	1,963,314
Gross profit (loss) from operations	1,136,897	1,963,314
Operating expenses
Selling expenses
Total selling expenses	734,826	757,891
Administrative expenses
Total administrative expenses	258,575	240,488
Research and development expenses
Total research and development expenses	47,187	54,492
Total operating expenses	1,040,588	1,052,871
Net other income (expenses)
Net other income (expenses)	0	0
Net operating income (loss)	96,309	910,443
Non-operating income and expenses
Other income
Total other income	38,717	36,766
Other gains and losses
Other gains and losses, net	47,196	62,206
Finance costs
Interest expense	29,884	27,947
Finance costs, net	29,884	27,947
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	2,154	21,879
Total non-operating income and expenses	58,183	92,904
Profit (loss) from continuing operations before tax	154,492	1,003,347
Tax expense (income)
Total tax expense (income)	5,531	170,996
Profit (loss) from continuing operations	148,961	832,351
Profit (loss) from discontinued operations
Total profit (loss) from discontinued operations	-26,566	-17,515
Profit (loss)	122,395	814,836
Other comprehensive income
Exchange differences on translation	40,721	26,525
Unrealised gains (losses) on valuation of available-for-sale financial assets	-374	458
Actuarial gains (losses) on defined benefit plans	-29,470	-34,983
Share of other comprehensive income of associates and joint ventures accounted for using equity method
Share of other comprehensive income of associates and joint ventures accounted for using equity method, exchange differences on translation	1,050	867
Share of other comprehensive income of associates and joint ventures accounted for using equity method, unrealized gains (losses) on available-for-sale financial assets	-6,114	4,210
Share of other comprehensive income of associates and joint ventures accounted for using equity method, actuarial gains (losses) on defined benefit plans	321	-518
Total share of other comprehensive income of associates and joint ventures accounted for using equity method	-4,743	4,559
Income tax related to components of other comprehensive income	2,797	-2,028
Other comprehensive income, net	3,337	-1,413
Total comprehensive income	125,732	813,423
Profit (loss), attributable to:
Profit (loss), attributable to owners of parent	118,906	753,119
Profit (loss), attributable to non-controlling interests	3,489	61,717
Comprehensive income attributable to:
Comprehensive income, attributable to owners of parent	122,933	751,258
Comprehensive income, attributable to non-controlling interests	2,799	62,165
Basic earnings per share
Basic earnings (loss) per share from continuing operations	0.31	1.65
Basic earnings (loss) per share from discontinued operations	-0.06	-0.04
Total basic earnings per share	0.25	1.61
Diluted earnings per share
Diluted earnings (loss) per share from continuing operations	0.31	1.65
Diluted earnings (loss) per share from discontinued operations	-0.06	-0.04
Total diluted earnings per share	0.25	1.61

Cash Flows

Unit: NTD/000

Consolidated	2014	2013 (Restated)
Cash flows from (used in) operating activities, indirect method
Profit (loss) from continuing operations before tax	154,492	1,003,347
Profit (loss) from discontinued operations before tax	-26,566	-17,515
Profit (loss) before tax	127,926	985,832
Adjustments
Adjustments to reconcile profit (loss)
Depreciation expense	364,397	344,159
Amortization expense	6,929	5,078
Provision (reversal of provision) for bad debt expense	1,668	-19
Net loss (gain) on financial assets or liabilities at fair value through profit or loss	-6,496	-42,310
Interest expense	29,884	27,947
Interest income	-15,814	-13,422
Dividend income	-426	-1,003
Share of loss (profit) of associates and joint ventures accounted for using equity method	-2,154	-21,879
Loss (gain) on disposal of property, plan and equipment	1,735	-5,105
Property, plan and equipment transferred to expenses	0	1,480
Loss (gain) on disposal of investments	29	686
Impairment loss on financial assets	0	0
Impairment loss on non-financial assets	0	3,181
Reversal of impairment loss on non-financial assets	110,952	-7,526
Other adjustments to reconcile profit (loss)	27,563	30,992
Total adjustments to reconcile profit (loss)	518,267	322,259
Changes in operating assets and liabilities
Changes in operating assets
Decrease (increase) in financial assets held for trading	543,344	94,627
Decrease (increase) in notes receivable	-38,864	77,450
Decrease (increase) in accounts receivable	-7,275	-39,666
Decrease (increase) in accounts receivable due from related parties	82,379	-17,774
Decrease (increase) in other receivable	-8,985	13,628
Decrease (increase) in other receivable due from related parties	-802	-3,304
Decrease (increase) in inventories	-501,278	-180,463
Decrease (increase) in prepayments	-51,623	-108,468
Decrease (increase) in other current assets	41,389	5,631
Total changes in operating assets	58,285	-158,339
Changes in operating liabilities
Increase (decrease) in notes payable	84	-102
Increase (decrease) in accounts payable	-197,276	237,590
Increase (decrease) in accounts payable to related parties	-26,104	-288,869
Increase (decrease) in other payable	-31,563	-27,334
Increase (decrease) in other payable to related parties	-5,113	-723
Increase (decrease) in provisions	-4,163	727
Increase (decrease) in other current liabilities	6,009	1,718
Increase (decrease) in accrued pension liabilities	-31,501	-32,337
Total changes in operating liabilities	-289,627	-109,330
Total changes in operating assets and liabilities	-231,342	-267,669
Total adjustments	286,925	54,590
Cash inflow (outflow) generated from operations	414,851	1,040,422
Interest received	15,046	14,841
Interest paid	-29,676	-27,800
Income taxes refund (paid)	-181,743	-78,567
Net cash flows from (used in) operating activities	218,478	948,896
Cash flows from (used in) investing activities
Acquisition of available-for-sale financial assets	-250	0
Proceeds from disposal of available-for-sale financial assets	309	0
Acquisition of bond investments without active market	-396,945	-193,924
Proceeds from disposal of bond investments without active market	194,708	18,925
Acquisition of financial assets at cost	-100,000	0
Proceeds from disposal of investments accounted for using equity method	0	39,511
Acquisition of property, plant and equipment	-255,569	-337,259
Proceeds from disposal of property, plant and equipment	3,464	6,392
Increase in refundable deposits	0	-1,692
Decrease in refundable deposits	1,650	1,988
Acquisition of intangible assets	-1,851	-1,832
Decrease in other non-current assets	0	0
Dividends received	426	1,003
Other investing activities	-17,325	-18,397
Net cash flows from (used in) investing activities	-571,383	-485,285
Cash flows from (used in) financing activities
Decrease in short-term loans	300,000	-12,536
Increase in short-term notes and bills payable	474,772	100,000
Decrease in short-term notes and bills payable	0	-346,920
Proceeds from long-term debt	0	0
Repayments of long-term debt	-246,427	-62,000
Increase in guarantee deposits received	3,247	5,561
Decrease in guarantee deposits received	-6,068	-3,071
Increase in other non-current liabilities	-202	-14
Cash dividends paid	-360,225	-169,926
Disposal of ownership interests in subsidiaries (without losing control)	0	0
Net cash flows from (used in) financing activities	165,097	-488,906
Effect of exchange rate changes on cash and cash equivalents	19,652	10,100
Net increase (decrease) in cash and cash equivalents	-168,156	-15,195
Cash and cash equivalents at beginning of period	928,585	943,780
Cash and cash equivalents at end of period	760,429	928,585
Cash and cash equivalents reported in the statement of financial position	760,429	928,585

Note: Subject has no obligations to disclose its financial statements to the third party according to the relevant policy in Taiwan and the only source from which we can obtain the information is the subject itself.

Subject’s relevant staff declined to disclose its financials citing the grounds of company’s confidentiality; from other sources we found the consolidated financial information of subject’s parent company (China General Plastics Corp.) 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. Lin
Department	Sales Department

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.65.75
UK Pound	1	Rs.102.17
Euro	1	Rs.74.38

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.