5. Operating Assets

5.1 Core Operating Assets of the company and its subsidiaries

As of 31 October 2012, the company and its subsidiaries have core
operating assets, as followings:

+---------------------------+-------+-------+--------+---------------+
| Items                     | Area  | Owne  | Net    | Encumbrance   |
|                           |       | rship | Book   |               |
|                           | (esti |       | Value  |               |
|                           | mated |       |        |               |
|                           |       |       | (THB   |               |
|                           | nu    |       | Mi     |               |
|                           | mber) |       | llion) |               |
+---------------------------+-------+-------+--------+---------------+
| 1. Land & Land            | 1,320 | owner | 468.80 | Some in Loan  |
| Development               | Rai   |       |        | Collateral    |
|                           |       | owner | 507.26 |               |
| Land for factory          | 239   |       |        |               |
| location.                 | Rai   | owner | 379.46 |               |
|                           |       |       |        |               |
| - Khon Kaen Sugar         | 720   | owner | 65.43  |               |
| Industry                  | Rai   |       |        |               |
|                           |       | owner | 183.65 |               |
| - Tamaka Sugar Industry   | 2     |       |        |               |
|                           | 75.15 | owner | 23.49  |               |
| - New Krung Thai Sugar    | Rai   |       |        |               |
| Factory                   |       | owner | 590.01 |               |
|                           | 696   |       |        |               |
| - New Kwang Soon Lee      | Rai   | owner | 128.37 |               |
| Sugar                     |       |       |        |               |
|                           | 212   | owner | 1,     |               |
| - Khon Kaen Alcohol       | Rai   |       | 380.25 |               |
|                           |       |       |        |               |
| - Khon Kaen Sugar Power   | 1     |       | 3,     |               |
| Plant Co., Ltd.           | 2,922 |       | 726.72 |               |
|                           | Rai   |       |        |               |
| Cane Plantation Area      |       |       |        |               |
|                           |       |       |        |               |
| Head Office               |       |       |        |               |
|                           |       |       |        |               |
| Other Lands               |       |       |        |               |
|                           |       |       |        |               |
| Total                     |       |       |        |               |
+---------------------------+-------+-------+--------+---------------+
| 2. Factory Building and   |       | Owner | 3,     | Some in Loan  |
| Construction              |       |       | 850.74 | Collateral    |
+---------------------------+-------+-------+--------+---------------+
| 3. Machinery and          |       | Owner | 8,     | Some in Loan  |
| Equipment                 |       |       | 778.74 | Collateral    |
+---------------------------+-------+-------+--------+---------------+
| 4. Motor Vehicle and      |       | Owner | 356.86 |               |
| Labors saving             |       |       |        |               |
|                           |       |       |        |               |
| device                    |       |       |        |               |
+---------------------------+-------+-------+--------+---------------+
| 5. Furniture and Office   |       | Owner | 65.38  |               |
| Equipment                 |       |       |        |               |
+---------------------------+-------+-------+--------+---------------+
| 6. Assets in Construction |       | Owner | 4,     |               |
|                           |       |       | 645.75 |               |
+---------------------------+-------+-------+--------+---------------+
| Total                     |       |       | 21,    |               |
|                           |       |       | 424.19 |               |
+---------------------------+-------+-------+--------+---------------+

5.2 Intangible Assets

Trademarks

Key trademarks of Khon Kaen Sugar Industry Public Company and
subsidiaries are registered at The Department of Intellectual Property,
as followings:

  ----------------------------------- -----------------------------------
  []                                  []

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

BOI Certificates

On 31 October 2012, Three domestic subsidiary companies received 7
investment promotion certificates from the Board of Investment of
Thailand (BOI) under the Investment Promotion Act B.E. 2520. The
benefits includes the exception of income tax for profit for the year
derived form operation of promoted businesses for the period of 8 years
commencing from the first date of income received from the promoted
business. The details are as follows :-

+------+------------+---------+------------------+-------+---+---------+---+
| Cer  | Sections   | Date    | Promoted         | Comm  | E |         |   |
| tifi |            |         | activity types   | enced | x |         |   |
| cate |            |         |                  | date  | p |         |   |
| No.  |            |         |                  |       | i |         |   |
|      |            |         |                  |       | r |         |   |
|      |            |         |                  |       | e |         |   |
|      |            |         |                  |       | d |         |   |
|      |            |         |                  |       | a |         |   |
|      |            |         |                  |       | t |         |   |
|      |            |         |                  |       | e |         |   |
+======+============+=========+==================+=======+===+=========+===+
|      |            |         |                  | of    |   |         |   |
|      |            |         |                  | rev   |   |         |   |
|      |            |         |                  | enues |   |         |   |
|      |            |         |                  | gene  |   |         |   |
|      |            |         |                  | rated |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 1929 | 25, 26,    | N       | - Production of  | Ja    | J |         |   |
| (2)/ | 28, 31,    | ovember | pure alcohol or  | nuary | a |         |   |
| 2547 | 34,        | 2, 2004 | fuel from        | 8,    | n |         |   |
|      |            |         | agricultural     | 2006  | u |         |   |
|      | 35(3),     |         | products,        |       | a |         |   |
|      | 36(1) and  |         | including        |       | r |         |   |
|      | 36(2)      |         | scraps, garbage  |       | y |         |   |
|      |            |         | or waste         |       | 7 |         |   |
|      |            |         |                  |       | , |         |   |
|      |            |         |                  |       | 2 |         |   |
|      |            |         |                  |       | 0 |         |   |
|      |            |         |                  |       | 1 |         |   |
|      |            |         |                  |       | 4 |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
|      |            |         |   - Production   | March | J |         |   |
|      |            |         |   of biological  | 30,   | a |         |   |
|      |            |         |   fertilizers or | 2006  | n |         |   |
|      |            |         |   organic        |       | u |         |   |
|      |            |         |   fertilizers    |       | a |         |   |
|      |            |         |                  |       | r |         |   |
|      |            |         |                  |       | y |         |   |
|      |            |         |                  |       | 7 |         |   |
|      |            |         |                  |       | , |         |   |
|      |            |         |                  |       | 2 |         |   |
|      |            |         |                  |       | 0 |         |   |
|      |            |         |                  |       | 1 |         |   |
|      |            |         |                  |       | 4 |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 1062 | 25, 26,    | January | - Production of  | I     |   |         |   |
| (2)/ | 28, 31,    | 30,     | pure alcohol or  | ncome |   |         |   |
| 2552 | 34,        | 2009    | fuel from        | not   |   |         |   |
|      |            |         | agricultural     | yet   |   |         |   |
|      | 35(3),     |         | products,        | de    |   |         |   |
|      | 36(1) and  |         | including        | rived |   |         |   |
|      | 36(2)      |         | scraps, garbage  |       |   |         |   |
|      |            |         | or waste         |       |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
|      |            |         | - Production of  | I     |   |         |   |
|      |            |         | biological       | ncome |   |         |   |
|      |            |         | fertilizers or   | not   |   |         |   |
|      |            |         | organic          | yet   |   |         |   |
|      |            |         | fertilizers      | de    |   |         |   |
|      |            |         |                  | rived |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 1063 | 25, 26,    | January | - Production of  | Dec   |   | D       |   |
| (2)/ | 28, 31,    | 30,     | pure alcohol or  | ember |   | ecember |   |
| 2552 | 34,        | 2009    | fuel from        | 6,    |   | 31,     |   |
|      |            |         | agricultural     | 2011  |   | .2019   |   |
|      | 35(3),     |         | products,        |       |   |         |   |
|      | 36(1) and  |         | including        |       |   |         |   |
|      | 36(2)      |         | scraps, garbage  |       |   |         |   |
|      |            |         | or waste         |       |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
|      |            |         | - Production of  | Dec   |   | D       |   |
|      |            |         | biological       | ember |   | ecember |   |
|      |            |         | fertilizers or   | 30,   |   | 31,     |   |
|      |            |         | organic          | 2011  |   | .2019   |   |
|      |            |         | fertilizers      |       |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
|      |            |         | - Production of  | Feb   |   | D       |   |
|      |            |         | biological       | ruary |   | ecember |   |
|      |            |         |                  | 29,   |   | 31,     |   |
|      |            |         |                  | 2012  |   | .2019   |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 2364 | 25 26 28   | Se      | - Production of  | I     |   |         |   |
| (1)/ | 31 34      | ptember | biological       | ncome |   |         |   |
| 2554 | 35(1)      | 20,     |                  | not   |   |         |   |
|      | 35(2)      | 2011    |                  | yet   |   |         |   |
|      |            |         |                  | de    |   |         |   |
|      | and 35(3)  |         |                  | rived |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 1258 | 25, 26,    | March   | - Production of  | Dec   |   | D       |   |
| (2)/ | 28, 31(3), | 29,     | electricity      | ember |   | ecember |   |
| 2548 | 31(4), 34  | 2005    | power            | 22,   |   | 21,     |   |
|      | and 35(3)  |         |                  | 2006  |   | 2014    |   |
|      |            |         | and steams       |       |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 1432 | 25, 26,    | June    | - Production of  | Nov   |   | N       |   |
| (2)/ | 28, 31(1), | 24,     | electricity      | ember |   | ovember |   |
| 2552 | 31(2),     | 2009    | power steams and | 30,   |   | 29,     |   |
|      | 31(3),     |         | water for        | 2010  |   | 2018    |   |
|      | 31(4), 34, |         | manufacture      |       |   |         |   |
|      | 35(1),     |         |                  |       |   |         |   |
|      | 35(2) and  |         |                  |       |   |         |   |
|      | 35(3)      |         |                  |       |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+
| 1657 | 25, 26,    | August  |   - Production   | June  |   | June 4, |   |
| (2)/ | 28, 31(1), | 25,     |   of pure        | 5,    |   | 2018    |   |
| 2552 | 31(3),     | 2009    |   vegetable oil  | 2010  |   |         |   |
|      | 31(4) and  |         |   and /or        |       |   |         |   |
|      | 34         |         |   semi-pure      |       |   |         |   |
|      |            |         |   vegetable oil  |       |   |         |   |
+------+------------+---------+------------------+-------+---+---------+---+

  Furthermore, in accordance with the Promotion Certificate No.
  1432(2)/2552, the subsidiary receives the privilege in 50% income tax
  reduction of the regular rate for the period of 5 years commencing
  from the expiration date of income tax exemption and under the
  Promotion Certificate No. 1657(2)/2552, the subsidiary is granted
  privilege for exemption of import duties for approved machinery and
  exemption from income tax on dividend on profit from promoted
  businesses during the period in which the Company is granted exemption
  from corporate income tax.

  Three foreign subsidiaries are granted by 1 foreign investment
  certificate and tax privilege from Lao People’s Democratic Republic
  and 5 investment certificates from Kingdom of Cambodia which the
  details are as follows: -

1)  Foreign Investment Certificate No. 017-06/ Khor Lor Tor includes tax
    privilege for exemption from income tax for 5 years from the date of
    first receiving revenue from sales of sugar, thereafter, the
    subsidiary shall pay income tax at the rate of 20%. The revenue is
    first derived on July 21, 2010 and will expire on July 20, 2015.

2)  Foreign Investment Certificate No. 4420/06 Ghor. Wor. Ghor. dated
    December 15, 2006 and No. 4342/07 Ghor. Wor. Ghor. dated November
    20, 2007 issued by the Council for the Development of Cambodia, the
    subsidiary is granted by tax privilege for exemption from import the
    duties for machinery for manufacturing and construction materials.

3)  Foreign Investment Certificate No. 1641/09 Ghor. Wor. Ghor. and No.
    1642/09 Ghor. Wor. Ghor. dated July 28, 2009 issued by the Council
    for the Development of Cambodia, the subsidiary is granted tax
    privilege for exemption from income tax for the period of 8 years,
    including priority period commencing from the period when subsidiary
    is operated (year 2006).

4)  Tax Exemption Certificate for agriculture-industrial (sugar cane)
    No. 4511 dated July 29, 2009 issued by the Ministry of Economy and
    Finance, Cambodia, grants the privilege to charge value-added tax at
    0% for sales of sugar cane to manufacture sugar for export. This
    certificate is valid for the period of 1 year from July 29, 2009 to
    July 28, 2010.

5.3 Investment and Management Policy for subsidiaries and affiliates

As of October 31, 2012, the company invests in both direct and indirect
19 subsidiaries and 1 affiliate, as followings:

Subsidiaries (The company holds the shares directly)

  1) Tamaka Sugar Industry Co.,Ltd

2) New Krung Thai Sugar Factory Co.,Ltd

3) New Kwang Soon Lee Sugar Factory co.,Ltd

4) KSL Real Estate Co.,Ltd

5) KSL Export Trading Co.,Ltd

6) Khon Kaen Sugar Power Plant Co.,Ltd

7) Khon Kaen Alcohol Co.,Ltd

8) KSL Chemical Co.,Ltd

9) Thai Sugar Terminal Public Company Limited

10) KSL Agro and Trading Co., Ltd.

11) Savannakhet Sugar Co.,Ltd

  12) Koh Kong Sugar Industry Co.,Ltd

  13) Wynn In Trading Co.,Ltd

Subsidiaries (The company holds shares directly and indirectly through
Thai Sugar Terminal Public Company Limited.)

  14) T S G ASSET CO., LTD.

  15) T S OIL INDUSTRY CO., LTD.

16) T S FLOUR MILL PUBLIC CO., LTD

17) TS WAREHOUSE CO., LTD.

18) T S TRANSPORT AND LOGISTIC CO., LTD.

Subsidiaries (The company holds the shares indirectly through Wynn In
Trading Co., Ltd.

  19) Koh Kong Plantation Co., Ltd.

Affiliate 1) Champion Fermentation Co.,Ltd

For the subsidiaries that the company holds its shares directly, the
company has controlling power through holding more than 50 % of shares
except Thai Sugar Terminal Public Company Limited and 5 subsidiaries
which the company holds directly and indirectly 23.82% of the share but
has controlling power in according with the definition of subsidiaries
specified in account standard.

The company has the policy to invest in the business related to sugar
business, sweetener business or other business that gives the benefit
and reasonable return to core business. The criteria for the investment
will be based on competitive advantage, reasonable return, the amount of
money to invest. In addition, considering the proportionate of
investment will be depended on many factors, such as, how significant
the expertise of business is. If the business needs special experiences
significantly and the company has no or less experience, the company
will let other strategic partners holding the share in higher
proportion. However; if the company has the investment in high
proportion, the company will assign its own representatives to
participate in a position of company directors or a position of top
management. In addition all of company investment must be approved by
the board of director and there should not be the conflict of interest
with the parent company in the future.