MIRA INFORM REPORT

Report No. :	495627
Report Date :	05.03.2018

IDENTIFICATION DETAILS

Name :	EAST GRACE CORPORATION

Registered Office :	No. 395 Zhongshan Road, Wuxi, Jiangsu Province 214001 PR

Country :	China

Financials (as on) :	31.12.2017

Date of Incorporation :	03.12.1999

Unified Social Credit Code :	91320200136003120E

Legal Form :	Limited liabilities company

Line of Business :	Subject registered business scope includes operating and acting as an agent of importing and exporting various kinds of commodities and technology, excluding the goods forbidden by the government; domestic trade; economic information consulting services; decoration services; rental housing; own equipment rental.

No. of Employees :	80

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

Credit Rating	Explanation	Rating Comments
A	Acceptable Risk	Business dealings permissible with moderate risk of default

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

Country Name

Previous Rating

(30.09.2017)

Current Rating

(31.12.2017)

China

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	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. China has implemented reforms in a gradualist fashion, resulting in efficiency gains that have contributed to a more than tenfold increase in GDP since 1978. Reforms began with the phaseout 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 continues to pursue an industrial policy, state support of key sectors, and a restrictive investment regime. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2016 stood as the largest economy in the world, surpassing the US in 2014 for the first time in modern history. China became the world's largest exporter in 2010, and the largest trading nation in 2013. Still, China's per capita income is below the world average.

After keeping its currency tightly linked to the US dollar for years, China in July 2005 moved to an exchange rate system that references a basket of currencies. From mid-2005 to late 2008, the renminbi appreciated more than 20% against the US dollar, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing announced it would allow a resumption of gradual liberalization. From 2013 until early2015, the renminbi (RMB) appreciated roughly 2% against the dollar, but the exchange rate fell 13% from mid-2015 until end-2016 amid strong capital outflows in part stemming from the August 2015 official devaluation; in 2017 the RMB resumed appreciating against the dollar – roughly 7% from end-of-2016 to end-of-2017. From 2013 to 2017, China had one of the fastest growing economies in the world, averaging slightly more than 7% real growth per year. In 2015, the People’s Bank of China announced it would continue to carefully push for full convertibility of the renminbi, after the currency was accepted as part of the IMF’s special drawing rights basket. However, since late 2015 the Chinese Government has strengthened capital controls and oversight of overseas investments to better manage the exchange rate and maintain financial stability.

The Chinese Government faces numerous economic challenges including: (a) reducing its high domestic savings rate and correspondingly low domestic household consumption; (b) managing its high corporate debt burden to maintain financial stability; (c) controlling off-balance sheet local government debt used to finance infrastructure stimulus; (d) facilitating higher-wage job opportunities for the aspiring middle class, including rural migrants and college graduates, while maintaining competitiveness; (e) dampening speculative investment in the real estate sector without sharply slowing the economy; (f) reducing industrial overcapacity; and (g) raising productivity growth rates through the more efficient allocation of capital and state-support for innovation. Economic development has progressed further in coastal provinces than in the interior, and by 2016 more than 169.3 million migrant workers and their dependents had relocated to urban areas to find work. One consequence of China’s population control policy known as the “one-child policy” - which was relaxed in 2016 to permit all families to have two children - 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 urbanization. The Chinese Government is seeking to add energy production capacity from sources other than coal and oil, focusing on natural gas, nuclear, and clean energy development. In 2016, China ratified the Paris Agreement, a multilateral agreement to combat climate change, and committed to peak its carbon dioxide emissions between 2025 and 2030.

The government's 13th Five-Year Plan, unveiled in March 2016, emphasizes the need to increase innovation and boost domestic consumption to make the economy less dependent on government investment, exports, and heavy industry. However, China has made more progress on subsidizing innovation than rebalancing the economy. Beijing has committed to giving the market a more decisive role in allocating resources, but the Chinese Government’s policies continue to favor state-owned enterprises and emphasize stability. Chinese leaders in 2010 pledged to double China’s GDP by 2020, and the 13th Five Year Plan includes annual economic growth targets of at least 6.5% through 2020 to achieve that goal. 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. Chinese leaders also have undermined some market-oriented reforms by reaffirming the “dominant” role of the state in the economy, a stance that threatens to discourage private initiative and make the economy less efficient over time. The slight acceleration in economic growth in 2017—the first such uptick since 2010—gives Beijing more latitude to pursue its economic reforms, focusing on financial sector deleveraging and its Supply-Side Structural Reform agenda, first announced in late 2015.

Source : CIA

COMPANY NAME and ADDRESS

COMPANY NAME	East Grace Corporation
CURRENT ADDRESS/ REGISTERED ADDRESS	No. 395 Zhongshan Road, Wuxi, Jiangsu Province 214001 PR China
TEL. NO.	86 (0) 510-82728125/82714176/82701443
FAX NO.	86 (0) 510-82701279/82718372

EXECUTIVE SUMMARY

Date of Registration : december 3, 1999

Unified social credit code : 91320200136003120E

LEGAL FORM : Limited liabilities company

CHIEF EXECUTIVE : Jiang Yafeng (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL : CNY 23,000,000

staff : 80

BUSINESS CATEGORY : trading

Revenue : CNY 412,612,000 (AS OF DEC. 31, 2017)

EQUITIES : CNY 34,468,000 (AS OF DEC. 31, 2017)

WEBSITE : www.eastgrace.com.cn

E-MAIL : wxegco@eastgrace.com

PAYMENT : SLOW BUT CORRECT

MARKET CONDITION : COMPETITIVE

FINANCIAL CONDITION : FAIRly stable

OPERATIONAL TREND : ORDINARY

GENERAL REPUTATION : average

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 unified social credit code: 91320200136003120E.

SC’s Import and Export Enterprise Code: 3200136003120

SC’s registered capital: CNY 23,000,000

SC’s paid-in capital: CNY 23,000,000

Registration Change Record:-

Date	Change of Contents	Before the change	After the change
2014-5-16	Legal Representative	Yuan Xudong	Jiang Yafeng

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

Name of Shareholder (s)	% of Shareholding
New East Grace International Corporation	86.96
Labor Union of New East Grace International Corporation	13.04

SC’s Chief Executives:-

Position	Name
Legal Representative and Chairman	Jiang Yafeng
General Manager	Yuan Xudong
Director	Cai Jianxin
	Su Jian
	Yang Wenbiao
	Jiang Weidong
Supervisor	Wang Yao
	Jiang Xiongbing
	Zhang Yan

RECENT DEVELOPMENT

No recent development was found during our checks at present.

SHAREHOLDER CHART & BACKGROUND

Name % of Shareholding

New East Grace International Corporation 86.96

Labor Union of New East Grace International Corporation 13.04

New East Grace International Corporation

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

Date of Registration: November 30, 1998

Unified Social Credit Code: 91320200250540878L

Chief Executive : Jiang Yafeng

Registered Capital: CNY 131,080,000

MANAGEMENT

Jiang Yafeng, Legal Representative and Chairman

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

Gender: M

Nationality: China

Age: 60

ID# 320204195809202314

Working experience (s):

At present, working in SC as legal representative and chairman, also working in New East Grace International Corporation as legal representative

Yuan Xudong, General Manager

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

Gender: M

Nationality: China

Working experience (s):

At present, working in SC as general manager

Director

-----------

Cai Jianxin

Su Jian

Yang Wenbiao

Jiang Weidong

Supervisor

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

Wang Yao

Jiang Xiongbing

Zhang Yan

BUSINESS OPERATION

SC’s registered business scope includes operating and acting as an agent of importing and exporting various kinds of commodities and technology, excluding the goods forbidden by the government; domestic trade; economic information consulting services; decoration services; rental housing; own equipment rental.

SC is mainly engaged in international trade.

SC’s products mainly include: textile goods, chemical & medical products, knitwear and hair knitwear, cereals & oils, garments, hardware mineral, machinery & electrical products, craft/ the light work products.

SC sources its products 80% from domestic market, and 20% from overseas market. SC sells 70% of its products in domestic market, and 30% to overseas market, mainly U.S.A., etc.

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 Customers*

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

Mahle Engine Components Usa Inc.

Sunrise Apparel Import, Inc.

Parry Enterprises India

Montanari Lifts Components Private Ltd.

HM Sure Rock Inc.

Mee Apparel Llc

Staff & Office:

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

SC is known to have approx. 80 staff at present.

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

RELATED COMPANY

SC is known to have a subsidiary at present,

Wuxi China Arts Import and Export Corporation

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

Date of Registration: April 14, 2002

Unified Social Credit Code: 91320213737815562F

Chief Executive : Qiu Qinggen

Registered Capital: CNY 1,000,000

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 records 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 Wuxi Branch

AC#: 487158227511

FINANCIALS

Balance Sheet

Unit: CNY’000	As of Dec. 31, 2016	As of Dec. 31, 2017
Cash	15,422	6,894
Short-term investment	0	0
Notes receivable	0	0
Accounts receivable	128,349	116,200
Advances to suppliers	0	0
Other receivable	1,708	1,727
Inventory	45,354	57,291
Non-current assets within one year	0	0
Other current assets	0	0
	------------------	------------------
Current assets	190,833	182,112
Long-term investment	650	650
Fixed assets	101	127
Construction in progress	0	0
Intangible assets	0	0
Long-term prepaid expenses	0	0
Deferred income tax assets	0	0
Other non-current assets	0	0
	------------------	------------------
Total assets	191,584	182,889
	=============	=============
Short-term loans	70,923	72,626
Notes payable	1,599	454
Accounts payable	31,373	26,369
Wages payable	0	0
Taxes payable	371	422
Advances from clients	52,336	47,817
Other payable	803	717
Other current liabilities	8	16
	------------------	------------------
Current liabilities	157,413	148,421
Non-current liabilities	0	0
	------------------	------------------
Total liabilities	157,413	148,421
Equities	34,171	34,468
	------------------	------------------
Total liabilities & equities	191,584	182,889
	=============	=============

Income Statement

Unit: CNY’000	As of Dec. 31, 2017
Revenue	412,612
Cost of sales	392,134
Sales expense	9,522
Management expense	5,579
Finance expense	4,590
Investment income	0
Profit before tax	613
Less: profit tax	314
Profits	299

Important Ratios

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

	As of Dec. 31, 2016	As of Dec. 31, 2017
*Current ratio	1.21	1.23
*Quick ratio	0.92	0.84
*Liabilities to assets	0.82	0.81
*Net profit margin (%)	--	0.07
*Return on total assets (%)	--	0.16
*Inventory / Revenue ×365	--	51 days
*Accounts receivable/ Revenue ×365	--	103 days
*Revenue/Total assets	--	2.26
*Cost of sales / Revenue	--	0.95

FINANCIAL COMMENTS

PROFITABILITY: AVERAGE

The revenue of SC appears fairly good in its line.

SC’s net profit margin is average.

SC’s return on total assets is average.

SC’s cost of sales is fairly high, comparing with its revenue.

LIQUIDITY: AVERAGE

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

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

The inventory of SC is maintained in an average level.

The accounts receivable of SC appears large.

SC’s short-term loans are in an average level.

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

LEVERAGE: AVERAGE

The debt ratio of SC is average.

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.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 65.23
UK Pound	1	INR 89.71
Euro	1	INR 79.50
CNY	1	INR 10.27

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	DIV

Report Prepared by :	TRU

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

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 are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

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.