Recent Survey

On 2 June 2020, Mr. Chen Yibo (phone 1366280****) provided complete financial statements and confirmed the operating and historical information in this report. Other information comes from third parties and the previous survey.

As of 2 June 2020 (report date), the subject's province had 1,595 confirmed COVID-19 cases. The subject reports that its business has been affected by the outbreak and the company has resumed work.

Huaxia D&B collects and verifies business information by calling relevant companies, browsing corporate public websites, and obtaining data publicly disclosed by the Chinese government.

Risk Analysis

Risk Alert Score

Industry Standard

Company Risk Comparison vs Industry Risk Indicators

Risk Alert Score Distribution in the Huaxia D&B China Database

Note: For more details on Huaxia D&B China's risk alert score principles and main factors, please refer to the report appendix.

Risk Composite Assessment Matrix

Risk Composite Assessment Matrix Analysis

* Assessment classifications are listed from low risk to high risk.

In the composite risk assessment matrix, the subject's assessment grade is BC, which belongs to the higher-risk group.

Third-Party Evaluation

Payment Information

As of 2 June 2020, Huaxia D&B's payment exchange program database had no detailed payment records for the subject. During this investigation, payment information about the subject also could not be successfully obtained through telephone interviews.

PAYDEX is D&B's proprietary quantitative indicator of a company's payment performance to suppliers. It is weighted and calculated from valid payment records obtained through the payment exchange program. PAYDEX ranges from 0 to 100: a higher score indicates better payment performance, while a lower score indicates more serious delinquency. The interpretation of PAYDEX is available in the appendix of this report.

Supplier Evaluation

Customer Evaluation

According to BorgWarner, one of the subject's customers, it has cooperated with the target company for less than one year. The subject's service quality is good, delivery is timely, and prices are acceptable.

According to Joyson Electronics, one of the subject's customers, it has cooperated with the target company for 4-5 years. The subject's service quality is good, delivery is timely, and prices are acceptable.

Company History

Registration Date

25 July 2011

Registration Authority

Dongguan Administration for Industry and Commerce, Guangdong Province

Unified Social Credit Code

9144190057969037X0

Registration Status

In operation (open for business)

Company History

Registration Profile

Operating Status

Open for business

Registered Capital

RMB 5,000,000

Paid-In Capital

RMB 5,000,000

Year Established

2011

Enterprise Type

Limited Liability Company (natural-person investment or holding)

Registered Address

No. 3 Yinqu Street, Jiaoyitang, Tangxia Town, Dongguan City

Legal Representative

Wang Bendong

Business Scope

Manufacture and sale of metal products; import and export of goods.

Shareholders

The above registration information comes from industrial and commercial registration channels. Query date: 2 June 2020.

Administrative Penalty

Historical Changes

The subject was established in 2011. Its current registered capital is RMB 5,000,000, and Wang Bendong currently serves as legal representative.

Key Principal

Related Enterprises

Operations Status

Production Capacity

Sales Distribution

Settlement Method: Telegraphic transfer.

Major Suppliers

Major Customers

Major Customers Continued

Customs Credit Classification

Employees

The above employee numbers are approximate.

Operations Summary

The subject is mainly engaged in the manufacture and sale of hardware products. Its main products include individual hardware parts. The company has obtained IATF 16949 certification. It currently owns 207 sets of production equipment and 4 production lines. Monthly production capacity for individual hardware parts is 5,000,000 pcs.

The subject has self-operated import and export rights, and its production is not seasonal. Approximately 65% of its products are sold domestically and 35% are exported. Export countries / regions mainly include the United States and others. Sales settlement is by telegraphic transfer, and major customers include BorgWarner and Joyson Electronics.

Approximately 70% of the subject's procurement is domestic and 30% is imported. Import countries / regions mainly include France. Major suppliers include Juchang Metal Co., Ltd. and Dongguan Junhaosheng Metal Materials Co., Ltd.; procurement settlement is generally by telegraphic transfer.

Premises

Financial Analysis and Banking

The 2019 financial statements were provided by the company.

Financial Analysis and Banking Continued

Balance Sheet Details

Income Statement

Key Financial Ratios

Financial Analysis and Banking Continued

Financial Analysis Summary

Main Banking Relationship

Industry Overview

In 2018, there were 23,739 metal products enterprises above designated size nationwide, of which 3,325 were loss-making enterprises, an increase of 2.4% year on year. The loss-making ratio was 14.0%.

Total assets of China's metal products industry were RMB 2,765.70 billion, up 4.6% year on year. Total liabilities were RMB 1,507.78 billion, and the asset-liability ratio of enterprises above designated size reached 54.5%, up 4.2 percentage points from the previous year.

Main business revenue of the national metal products industry was RMB 3,368.15 billion, with cumulative growth of 9.9%. Total profit was RMB 159.02 billion, with cumulative growth of 8.0%, and the sales profit margin reached 4.7%.

In 2018, national export delivery value for the metal products industry was RMB 369.35 billion, up 8.6% year on year.

Public Records

Litigation Records

As of 2 June 2020, Huaxia D&B China found no litigation records related to the subject company within the last five years after searching China Court websites, court websites in the investigated company's location, major relevant domestic court websites, and Huaxia D&B China's internally collected Chinese court litigation database.

Note: The above are currently publicly searchable channels for Chinese enterprise litigation records. However, mainland China currently does not have a unified database covering all enterprise litigation information, so some cases involving the investigated company may be omitted.

Media Records

As of 2 June 2020, Huaxia D&B China had not obtained any media information related to the subject within the last two years.

Appendix

D&B EMMA Score

The D&B EMMA Score is a risk assessment system developed by D&B for emerging-market countries. Through regular research on large volumes of data, D&B establishes scientific statistical analysis models. The score predicts the likelihood that an enterprise is in an unstable or unreliable risk condition, such as poor financial condition, inability to pay on time, slow-moving products, or inability to operate normally. It is also suitable for quickly judging a company's risk condition and, when combined with other information, can help optimize risk decisions.

The risk alert score is identified by numbers from 1 to 10. A score of 1 represents lower enterprise risk, while a score of 10 represents higher enterprise risk.

The China risk alert score was first launched in May 2009 and was developed through analysis of nearly one million enterprise data samples. When using this score to make decisions about a company, Huaxia D&B China recommends combining the risk alert score with the specific situation of the customer group and establishing risk scoring standards suitable for your company. A high risk alert score does not mean that trading with the company will necessarily result in risk.

Given the special characteristics of China's business environment, Huaxia D&B China optimized and adjusted the China risk alert score in the first half of 2012 so that it could better analyze and reflect risk factors for Chinese enterprises. PAYDEX was incorporated into the assessment model as an important risk assessment dimension to reflect the internal factors of enterprise risk more deeply.

The China risk alert score undergoes routine validation under D&B's global model development methodology to ensure timely and accurate capture of changes in China's business environment triggered by macroeconomic shifts and specific events.

The main factors determining the risk alert score include:

Appendix Continued

Main Factors in the Risk Alert Score

• Enterprise type
• Region and province
• Industry
• Number of negative information records
• Number of employees
• Overdue payment amount ratio
• Sales region
• Company / industry PAYDEX
• Registered capital
• Year established
• Historical records
• Property status

Risk Decision Guidance

Risk Alert Score and PAYDEX Matrix

Composite Risk Assessment Matrix

* Assessment classifications are listed from low risk to high risk.

The composite risk assessment matrix is a tool for in-depth interpretation of the target enterprise by combining the risk alert score and PAYDEX. The risk alert score assesses enterprise risk level, while PAYDEX further analyzes enterprise risk through payment behaviour and helps identify internal risk drivers. Therefore, the matrix provides deeper analysis for companies with similar risk alert scores.

When using the risk alert score and composite risk assessment matrix, clients are advised to combine them with other information, such as internal assessment policies, business information provided by D&B China, and feedback from personnel who have direct contact with the target enterprise, to support risk decisions.

D&B Financial Strength Rating

Appendix Continued

D&B Financial Strength Rating Continued

D&B PAYDEX®

A PAYDEX score of 80 indicates that D&B payment records show the company generally pays on time. A PAYDEX score above 80 indicates that D&B payment records show the company pays earlier than the agreed payment terms. The table below explains the meaning represented by each PAYDEX range.

Customs Credit Management

Copyright: Shanghai Huaxia Dun & Bradstreet Business Information Consulting Co., Ltd.