MIRA INFORM REPORT

Report No. :	511300
Report Date :	30.05.2018

IDENTIFICATION DETAILS

Name :	FORMOSAN UNION CHEMICAL CORPORATION
Registered Office :	14th Floor, No. 206, Nanking E. Road, Sec. 2, Taipei, R.O.C.
Country :	Taiwan
Financials (as on) :	31.12.2017
Date of Incorporation :	21.06.1973
Com. Reg. No.:	04312878
Legal Form :	Joint Stock Company
Line of Business :	Manufacturing and sales of chemical products
No. of Employees :	471

RATING & COMMENTS

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

MIRA’s Rating :

A

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

Status :	Good
Payment Behaviour :	Regular
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)
Taiwan	A1	A1

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

TAIWAN - ECONOMIC OVERVIEW

Taiwan has a dynamic capitalist economy that is driven largely by industrial manufacturing, and especially exports of electronics, machinery, and petrochemicals. This heavy dependence on exports exposes the economy to fluctuations in global demand. Taiwan's diplomatic isolation, low birth rate, rapidly aging population, and increasing competition from China and other Asia Pacific markets are other major long-term challenges.

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 of that year, 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 uncertain. President TSAI since taking office in May 2016 has promoted greater economic integration with South and Southeast Asia through the New Southbound Policy initiative and has also expressed interest in Taiwan joining the Trans-Pacific Partnership as well as bilateral trade deals with partners such as the US. These overtures have likely played a role in increasing Taiwan’s total exports, which rose 11% during the first half of 2017, buoyed by strong demand for semiconductors.

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 with many economies, including China and the US, 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 and has also secured greater market access for its investors on 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 renminbi (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 opportunities for Taiwan’s economy but also pose challenges as political differences remain unresolved and China’s economic growth is slowing. President TSAI’s administration has made little progress on the domestic economic issues that loomed large when she was elected, including concerns about stagnant wages, high housing prices, youth unemployment, job security, and financial security in retirement. TSAI has made more progress on boosting trade with South and Southeast Asia, however, which may help insulate Taiwan’s economy from a fall in mainland demand should China’s growth slow in 2018.

Source : CIA

Company Name and Address

Company Name:	Formosan Union Chemical Corporation
Supplied Name:	FORMOSAN UNION CHEMICAL CORPORATION
Trading Address:	14th Floor, No. 206, Nanking E. Road, Sec. 2, Taipei, Taiwan, R.O.C.
Supplied Address:	14F, NO. 206, NANKING EAST ROAD, SEC 2, TAIPEI
Telephone Number:	+886-2-2507-1234
Fax Number:	+886-2-2507-1664
E-mail:	fucc@fucc.com.tw

Notes: The exact name and address are as above.

Company Identification Details

Registered Name:	Formosan Union Chemical Corporation
Registered Address:	14th Floor, No. 206, Nanking E. Road, Sec. 2, Taipei, Taiwan, R.O.C.
Date of Foundation:	1973-6-21
Registration Number:	04312878
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Registered Capital:	NTD 9,000,000,000 (USD 270,000,000) (As of 2018.5, 1 NTD = 0.03 USD)
Paid-up Capital:	NTD 4,921,377,940 (USD 147,641,338.2)
Legal Representatives:	Shengcai Huang
Legal Form:	Joint Stock Company
Principal Activities:	Manufacturing and sales of chemical products
Staff:	471 Employees (As of 2017-4-30)
Listed at Stock Exchange:	Yes, Stock Symbol: 1709
Date of Last Annual Return:	2018-4-27

History

Subject was incorporated on 1973-6-21 with registered number 04312878 as Joint Stock Company in Taiwan.

Subject was listed on Taiwan Stock Exchange on 1986-07-03.

Corporate Structure

Factory

Address:	No.9, Shihua 3^rd Rd., Linyuan Dist., Kaohsiung City, Taiwan (R.O.C.)
Date of Foundation:	1977-7-8
Date of Registration:	1990-12-31
Factory Registration Number:	99661323
Factory Manager:	Shengcai Huang
Status:	In production
Date of Last Annual Return:	2014-9-1
Major Products:	184 Synthetic resin, plastic and rubber 199 Other chemical products
Tel	+886-7-641-2921

Branch

Name	Kaohsiung Branch
Address	No.9, Shihua 3rd Rd., Linyuan Dist., Kaohsiung City, Taiwan (R.O.C.)
Registration Number	54393777
Date of Registration	2014-12-3
Status	Live Company
Manager Name	Shengcai Huang
Date of Last Annual Return	2015-5-27

Major Related Companies

1
Name	Hershey Engineering Company, Ltd.
Address	12, Yuanshan Rd., Donghai Village, Fanlian Hsiang, Pingdong Hsien
Telephone Number	+886-8-8667692
Fax Number	+886-8-8666527
2
Name	United Performance Materials Corp.
Address	10, Jinchin Rd., Donghai Village, Fanliao Hsiang, Pingdong Hsien
Telephone Number	+886-8-8668285
Fax Number	+886-8-8668261
3
Name	Soft Chemical Corp.
Address	110 Ngo Quyen Street, Haiphong City, Vietnam.
Telephone Number	+84-31-3837122
Fax Number	+84-31-3836510
4
Name	Zhangjiagang Trans-Ocean Enterprise Co., Ltd., A Chinese and Oversea Joint Venture
Address	110, Yunho Village, Zhangjiagang City, Jingsu Province
Telephone Number	+86-520-8573127
Fax Number	+86-520-8573117
5
Name	Great Victory Chemical Industry Co., Ltd
Address	14F, No 206, Sec 2, Nanking E. Road, Taipei, Taiwan, ROC.
Telephone Number	+886-2-25033131
Fax Number	+886-2-25034600

Shareholders

Major Shareholders

Name	Subscription Shares
Shin Shing Chemical Corporation	18,360,000
Shengshun Huang	1,403,139
He Mao Chuang Ye Investment Co., Ltd (Literal Translation)	10,376
Delun Huang	640,000
Ever-Prosperous Multitechnologies Enterprise Ltd.	2,090,886
Xin Chang Construction Co., Ltd (Literal Translation)	1,933,287
Qi Dong Investment Co., Ltd (Literal Translation)	29,000,000
Deshi Lian	130,430
Jiaguo Liao	351,423
Lion Home Products (Taiwan) Co., Ltd	12,180,366
Zhenzhi Guo	3,259,847
Jia’an Shi	512,531
Zhimao Guo	1,275,588
Defeng Chen	2,452,656
Formosa Chemicals & Fibre Corp	15,498,339
Hongwen Chen	170,000

Shareholder Information:

1
Registered Name:	Shin Shing Chemical Corporation
Registered Address:	No.90, Liu Chou Street, Taipei, Taiwan
Date of Foundation:	1979-11-13
Registration Number:	15862602
Registry:	Taipei City Government
Legal Representatives:	Shengcai Huang
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2017-5-31
2
Registered Name:	He Mao Chuang Ye Investment Co., Ltd (Literal Translation)
Registered Address:	8F., No.6, Sec. 1, Zhongxing Rd., Wugu Dist., New Taipei City, Taiwan (R.O.C.)
Date of Foundation:	1998-2-16
Registration Number:	16437606
Registry:	New Taipei City Government
Legal Representatives:	Youjie Yang
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2017-8-31
3
Registered Name:	Ever-Prosperous Multitechnologies Enterprise Ltd.
Registered Address:	6F., No.394, Minsheng W. Rd., Datong Dist., Taipei City, Taiwan (R.O.C.)
Date of Foundation:	1998-12-26
Registration Number:	23604988
Registry:	Taipei City Government
Legal Representatives:	Yangci Suke
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2017-6-1
4
Registered Name:	Formosa Chemicals & Fibre Corp.
Registered Address:	No.359, Sec. 3, Zhongshan Rd., Changhua City, Changhua County, Taiwan (R.O.C.)
Date of Foundation:	1965-3-5
Registration Number:	58650902
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Legal Representatives:	Wenyuan Wang
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2018-2-2
5
Registered Name:	Xin Chang Construction Co., Ltd (Literal Translation)
Registered Address:	6F., No.394, Minsheng W. Rd., Datong Dist., Taipei City 10342, Taiwan (R.O.C.)
Date of Foundation:	1992-4-24
Registration Number:	86631505
Registry:	New Taipei City Government
Legal Representatives:	Zhiqun Guo
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2016-7-7
6
Registered Name:	Qi Dong Investment Co., Ltd (Literal Translation)
Registered Address:	1F., No.90, Liuzhou St., Wanhua Dist., Taipei City, Taiwan (R.O.C.)
Date of Foundation:	1997-7-2
Registration Number:	97477114
Registry:	Taipei City Government
Legal Representatives:	Jinfeng Huangsu
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2017-11-20
7
Registered Name:	Lion Home Products (Taiwan) Co., Ltd.
Registered Address:	18F.-1, No.97, Sec. 4, Chongxin Rd., Sanchong Dist., New Taipei City, Taiwan (R.O.C.)
Date of Foundation:	2015-9-1
Registration Number:	24797652
Registry:	Department of Commerce, Ministry of Economic Affairs, R.O.C.
Legal Representatives:	Jing He
Legal Form:	Joint Stock Company
Date of Last Annual Return:	2018-1-12

Management Information

Core Management

Directors

1
Name		Shengcai Huang
Position		Board Chairman
2
Name	Shengshun Huang
Position		Vice-chairman of the Board
3
Name	Yitong Cai
Position		Director
4
Name	Delun Huang
Position		Director
5
Name	Changqi Ke
Position		Director
6
Name		Zhiqun Guo
Position		Director
7
Name	Chengfeng Huang
Position		Director
8
Name	Deshi Lian
Position		Director
9
Name		Jiaguo Liao
Position		Director
10
Name	Hao He
Position		Director
11
Name	Zhenzhi Guo
Position		Director
12
Name	Jia’An Shi
Position		Director
13
Name	Zhimao Guo
Position		Director
14
Name		Defeng Chen
Position		Director
15
Name	Kunlie Yang
Position		Director
16
Name	Songyue Liao
Position		Independent Director
17
Name	Laidi Lin
Position		Independent Director
18
Name		Hongwen Chen
Position		Independent Director
19
Name	Xunrong Zhuo
Position		Independent Director
20
Name	Chuncheng Lin
Position		Manager
Date of Appointment:		2017-8-1

Personnel Structure

Total Employees

491 Employees (As of 2016-4-30)

Operation Information

Offices & Factories

	Headquarters
Add	14th Floor, No. 206, Nanking E. Road, Sec. 2, Taipei, Taiwan, R.O.C.

Production Information

Subject is a manufacturer of chemical products, etc.

It is introduced that subject has a factory in Kaohsiung City, Taiwan for production.

It is introduced that subject also has other factories in Taiwan, but the subject declined to disclose the details for us, and we cannot get the detailed information from any valid sources, either.

It is introduced that subject has obtained ISO 9001, ISO 14001, OHSAS-18001 and ISO 9002 certifications.

It is introduced that subject’s annual production capacity of hydrogenated hydrocarbon resin is about 10,500 tons; the annual alkyl benzene production capacity is increased to 105,000 tons.

Purchase Information

The registered activities of subject:

Business Code	Details
C801020	Manufacturing of petrochemical engineering raw materials.
F112040	Wholesales of petrochemical engineering product.
C801010	Fundamental chemical industry.
D201040	Subpackage of liquefied petroleum gas.
IF03010	Testing of liquefied petroleum gas cylinder.
H703100	Renting of real estate.
C109010	Manufacturing of spices.
C801100	Manufacturing of synthetic resin and plastic.
F401010	International trading business.
C801040	Manufacturing of synthetic resin.
C801050	Manufacturing of plastic raw materials.
C801060	Manufacturing of synthetic rubber.
C802030	Manufacturing of coating and paint.
J101040	Processing of salvaged material.
J101060	Processing of wastewater.
C803990	Manufacturing of petrochemical and coal products.

The raw materials for production are purchased both at home and abroad.

It is introduced that subject purchases some nalkane in Taiwan.

It is introduced that subject imports its raw materials such as normal olefin hydrocarbons, nalkane, benzene, tripropylene, phenol and tetrapropylene, etc in oversea market.

Sales Information

The subject is mainly engaged in sales of chemical products, etc.

The main products include alkyl benzene, nonyl phenol, hydrogenated hydrocarbon resin, etc.

It is introduced that subject’s products are applied for detergents, surfactants rubbers, plastic anti-oxidant agents, ethylene-vinyl acetate polymer EVA and thermal plastic rubber TPR series hot met adhesives, etc.

The major sales regions are domestic market, Southeast Asia, Northeast Asia, Middle South America, etc.

It is introduced that subject’s 30% of products are sold in domestic market, while 70% are sold to other countries.

The major types of customers are manufacturers of textile, plastic products and etc.

Some customers of the subject are P & G, Unilever, KAO, Fabrica De Jabon La Corona SA De CV, T.h. International, Inc., etc.

Import and export right:

Import right	Yes
Export right	Yes

Settlements

Purchase

Domestic Purchase

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

Import

Products	Raw materials
Payment Terms	L/C, T/T, etc.

Sales

Domestic Markets

Product	Chemical products, etc.
Selling Terms	T/T, Cash, etc.

Export

Product	Chemical products, etc.
Selling Terms	L/C, T/T, etc.

Balance Sheet

Unit: NTD/000

Consolidated	2017-12-31	2016-12-31
Assets
Current assets
Cash and cash equivalents
Total cash and cash equivalents	506,484	847,492
Current financial assets at fair value through profit or loss
Total current financial assets at fair value through profit or loss	85,053	160,101
Current available-for-sale financial assets
Current available-for-sale financial assets	55,179	116,721
Current available-for-sale financial assets, net	55,179	116,721
Current bond investment without active market
Total Current investments in debt instrument without active market	38,600	11,200
Notes receivable, net
Notes receivable, net	146,541	162,595
Accounts receivable, net
Accounts receivable, net	866,722	807,159
Accounts receivable due from related parties, net
Accounts receivable due from related parties, net	5,951	0
Other receivables
Other receivables, net	56,699	74,088
Other receivables due from related parties
Other receivables due from related parties, net	0	0
Current tax assets
Total current tax assets	18	48
Inventories
Inventories, manufacturing business
Inventories, manufacturing business, net	2,746,080	2,855,595
Total inventories	2,746,080	2,855,595
Prepayments
Total prepayments	67,578	77,594
Other current assets
Total other current assets	3,076	842
Total current assets	4,577,981	5,113,435
Non-current assets
Non-current available-for-sale financial assets
Non-current available-for-sale financial assets, net	497,486	399,834
Non-current financial assets at cost
Non-current financial assets at cost, net	83,933	80,000
Investments accounted for using equity method
Investments accounted for using equity method	821,947	378,733
Investments accounted for using equity method, net	821,947	378,733
Property, plant and equipment
Total property, plant and equipment	2,722,399	2,710,208
Investment property, net
Investment property, net	11,874	13,740
Intangible assets
Computer software, net
Computer software, net	2,550	658
Goodwill	94,799	91,897
Other intangible assets, net
Other intangible assets, net	18	55
Total intangible assets	97,367	92,610
Deferred tax assets	95,309	85,539
Other non-current assets
Prepayments for business facilities	1,549,772	1,383,478
Guarantee deposits paid	4,884	4,153
Other non-current assets, others
Total other non-current assets, others	72,353	77,507
Total other non-current assets	1,627,009	1,465,138
Total non-current assets	5,957,324	5,225,802
Total assets	10,535,305	10,339,237
Liabilities and equity
Liabilities
Current liabilities
Short-term borrowings
Total short-term borrowings	670,000	431,000
Current financial liabilities at fair value through profit or loss
Total current financial liabilities at fair value through profit or loss	522	468
Notes payable
Total notes payable	14,008	8,996
Accounts payable
Total accounts payable	323,882	370,070
Accounts payable to related parties
Accounts payable to related parties	3,698	0
Total accounts payable to related parties	3,698	0
Other payables
Total other payables	567,389	598,698
Other payables to related parties	0	126
Current tax liabilities	66,404	135,589
Current provisions
Total current provisions	23,468	26,815
Other current liabilities
Long-term liabilities, current portion
Total long-term liabilities, current portion	129,341	48,148
Other current liabilities, others	14,781	20,558
Total other current liabilities	144,122	68,706
Total current liabilities	1,813,493	1,640,468
Non-current liabilities
Bonds payable
Total bonds payable	120,534	474,480
Long-term borrowings
Total long-term borrowings	523,075	466,654
Deferred tax liabilities
Total deferred tax liabilities	169,864	166,151
Other non-current liabilities
Net defined benefit liability, non-current	110,157	101,755
Other non-current liabilities, others	237	237
Total other non-current liabilities	110,394	101,992
Total non-current liabilities	923,867	1,209,277
Total liabilities	2,737,360	2,849,745
Equity
Equity attributable to owners of parent
Share capital
Ordinary share	4,909,260	4,449,513
Total capital stock	4,909,260	4,449,513
Capital surplus
Total capital surplus	184,511	284,646
Retained earnings
Legal reserve	802,652	717,779
Special reserve	251,175	251,175
Unappropriated retained earnings (accumulated deficit)
Total unappropriated retained earnings (accumulated deficit)	1,058,069	1,250,417
Total retained earnings	2,111,896	2,219,371
Other equity interest
Exchange differences on translation of foreign financial statements
Total exchange differences on translation of foreign financial statements	-15,741	2,766
Unrealized gains (losses) on available-for-sale financial assets
Total unrealized gains (losses) on available-for-sale financial assets	207,812	123,557
Total other equity interest	192,071	126,323
Total equity attributable to owners of parent	7,397,738	7,079,853
Non-controlling interests	400,207	409,639
Total equity	7,797,945	7,489,492
Total liabilities and equity	10,535,305	10,339,237

Profit and Loss Account

Unit: NTD/000

Consolidated	2017	2016
Operating revenue
Total operating revenue	8,787,780	8,574,420
Operating costs
Total operating costs	7,137,338	6,747,466
Gross profit (loss) from operations	1,650,442	1,826,954
Gross profit (loss) from operations	1,650,442	1,826,954
Operating expenses
Selling expenses
Total selling expenses	471,897	487,904
Administrative expenses
Total administrative expenses	267,290	241,817
Research and development expenses
Total research and development expenses	56,444	53,693
Total operating expenses	795,631	783,414
Net operating income (loss)	854,811	1,043,540
Non-operating income and expenses
Other income
Total other income	60,373	40,438
Other gains and losses
Other gains and losses, net	-87,679	29,930
Finance costs
Finance costs, net	9,125	23,555
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	2,385	19,663
Total non-operating income and expenses	-34,046	66,476
Profit (loss) from continuing operations before tax	820,765	1,110,016
Tax expense (income)
Total tax expense (income)	158,630	208,770
Profit (loss) from continuing operations	662,135	901,246
Profit (loss)	662,135	901,246
Other comprehensive income
Components of other comprehensive income that will not be reclassified to profit or loss
Gains (losses) on remeasurements of defined benefit plans	-31,213	7,287
Income tax related to components of other comprehensive income that will not be reclassified to profit or loss	-5,306	1,239
Components of other comprehensive income that will not be reclassified to profit or loss	-25,907	6,048
Components of other comprehensive income that will be reclassified to profit or loss
Exchange differences on translation	-4,860	-201
Unrealised gains (losses) on valuation of available-for-sale financial assets	79,549	1,215
Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss
Share of other comprehensive income of associates and joint ventures accounted for using equity method, components of other comprehensive income that will be reclassified to profit or loss	-17,546	-4,552
Income tax related to components of other comprehensive income that will be reclassified to profit or loss	-8,496	-6,698
Components of other comprehensive income that will be reclassified to profit or loss	65,639	3,160
Other comprehensive income, net	39,732	9,208
Total comprehensive income	701,867	910,454
Profit (loss), attributable to:
Profit (loss), attributable to owners of parent	629,326	848,729
Profit (loss), attributable to non-controlling interests	32,809	52,517
Comprehensive income attributable to:
Comprehensive income, attributable to owners of parent	672,854	857,937
Comprehensive income, attributable to non-controlling interests	29,013	52,517
Basic earnings per share
Basic earnings (loss) per share from continuing operations	1.32	1.88
Total basic earnings per share	1.32	1.88
Diluted earnings per share
Diluted earnings (loss) per share from continuing operations	1.26	1.70
Total diluted earnings per share	1.26	1.70

Cash Flows

Unit: NTD/000

Consolidated	2017	2016
Cash flows from (used in) operating activities, indirect method
Profit (loss) from continuing operations before tax	820,765	1,110,016
Profit (loss) before tax	820,765	1,110,016
Adjustments
Adjustments to reconcile profit (loss)
Depreciation expense	193,967	229,738
Amortization expense	2,022	801
Provision (reversal of provision) for bad debt expense	1,144	0
Net loss (gain) on financial assets or liabilities at fair value through profit or loss	-749	129
Interest expense	9,125	23,555
Interest income	-6,223	-4,169
Dividend income	-25,140	-15,598
Share of loss (profit) of associates and joint ventures accounted for using equity method	-2,385	-19,663
Loss (gain) on disposal of property, plan and equipment	210	-59
Loss (gain) on disposal of investment properties	-2,481	0
Loss (gain) on disposal of investments	-333	-43,711
Loss (gain) on disposal of investments accounted for using equity method	2,007	0
Reversal of impairment loss on non-financial assets	-5,001	-36,854
Unrealized foreign exchange loss (gain)	5,300	-101
Other adjustments to reconcile profit (loss)	0	-10,750
Total adjustments to reconcile profit (loss)	171,463	123,318
Changes in operating assets and liabilities
Changes in operating assets
Decrease (increase) in financial assets held for trading	75,851	-159,762
Decrease (increase) in notes receivable	16,054	-42,548
Decrease (increase) in accounts receivable	-67,218	155,832
Decrease (increase) in accounts receivable due from related parties	-5,951	18,053
Decrease (increase) in other receivable	17,241	-10,050
Decrease (increase) in other receivable due from related parties	0	2,018
Decrease (increase) in inventories	62,455	-136,724
Decrease (increase) in prepayments	6,483	111,569
Decrease (increase) in other current assets	-2,234	310
Total changes in operating assets	102,681	-61,302
Changes in operating liabilities
Increase (decrease) in notes payable	5,012	2,050
Increase (decrease) in accounts payable	-45,556	-37,749
Increase (decrease) in accounts payable to related parties	3,698	0
Increase (decrease) in other payable	-42,010	33,412
Increase (decrease) in other payable to related parties	-126	-575
Increase (decrease) in provisions	-3,347	-1,439
Increase (decrease) in other current liabilities	-5,777	10,189
Increase (decrease) in net defined benefit liability	-22,811	-26,606
Total changes in operating liabilities	-110,917	-20,718
Total changes in operating assets and liabilities	-8,236	-82,020
Total adjustments	163,227	41,298
Cash inflow (outflow) generated from operations	983,992	1,151,314
Interest received	6,361	4,123
Dividends received	25,140	15,598
Interest paid	-15,269	-11,047
Income taxes refund (paid)	-220,040	-191,137
Net cash flows from (used in) operating activities	780,184	968,851
Cash flows from (used in) investing activities
Acquisition of available-for-sale financial assets	-52,561	-394,272
Proceeds from disposal of available-for-sale financial assets	96,333	605,267
Acquisition of investments in debt instrument without active market	-27,400	0
Acquisition of financial assets at cost	-3,933	-80,000
Acquisition of investments accounted for using equity method	-460,950	-237,563
Net cash flow from acquisition of subsidiaries	0	0
Proceeds from disposal of subsidiaries	-911	0
Acquisition of property, plant and equipment	-156,076	-41,003
Proceeds from disposal of property, plant and equipment	1,940	66
Increase in refundable deposits	-751	0
Decrease in refundable deposits	0	53,334
Decrease in other receivables due from related parties	0	0
Acquisition of intangible assets	-789	-739
Acquisition of investment properties	0	-9,231
Proceeds from disposal of investment properties	4,079	0
Decrease in other non-current assets	5,154	4,971
Increase in prepayments for business facilities	-149,541	-387,396
Dividends received	2,575	2,288
Net cash flows from (used in) investing activities	-742,831	-484,278
Cash flows from (used in) financing activities
Increase in short-term loans	239,000	0
Decrease in short-term loans	0	-204,000
Proceeds from long-term debt	205,650	480,902
Repayments of long-term debt	-68,036	-564,972
Decrease in other payables to related parties	0	0
Cash dividends paid	-711,922	-515,919
Disposal of ownership interests in subsidiaries (without losing control)	0	9,918
Change in non-controlling interests	-41,668	-36,442
Net cash flows from (used in) financing activities	-376,976	-830,513
Effect of exchange rate changes on cash and cash equivalents	-1,385	-201
Net increase (decrease) in cash and cash equivalents	-341,008	-346,141
Cash and cash equivalents at beginning of period	847,492	1,193,633
Cash and cash equivalents at end of period	506,484	847,492
Cash and cash equivalents reported in the statement of financial position	506,484	847,492

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

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

Bankers

Name	Hua Nan Bank Mega International Commercial Bank

Note: The above bank information is from public source.

Public Record

Mortgage

Case Type:	Chattel Mortgage
Registered Number:	3181
Debtor Name:	Formosan Union Chemical Corporation
Registry:	Economic Development Bureau of Taichung City Government
Name of Mortgagee:	The First Commercial Bank Co., Ltd.
Date of Registration:	2012-7-24
Amount of Secure Claims:	NTD 650,000,000
Type of Mortgage:	Machinery equipment and tools.

Lawsuit

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

Special Note

Interview Details

Department

Sales Department

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 67.82
UK Pound	1	INR 90.17
Euro	1	INR 78.70
TWD	1	INR 2.24

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

INFORMATION DETAILS

Analysis Done by :	NIY
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.