Part 1

Executive Summary

Capetronic International (Thailand) Public Company Limited (“the
Company”) is engaged in the manufacturing and exporting of computer
monitors under its customers’ brand name (OEM customers). The Company
was granted the promotion incentive privilege by the Board of Investment
(“BOI”). The Company’s sales transactions are generated through
associated companies in Hongkong and after sales services are provided
through associated companies in USA, Europe, and the Far East. As at
December 31, 2001, the Company has a registered share capital of Baht
20,156.39 million and issued and fully paid capital of Baht 14,009.37
million. The major shareholders of the Company comprises of the
Companies within the group of The Grande Holdings Limited, holding in
aggregate 1,155 million shares or 82.46 percent of the total issued
shares in the Company. (Based on information as at December 27,2002).

In 2002, the Company sold a total of approximately 6K units of computer
monitors, a decrease by 99% from 615K units in 2001. In 2001 sales value
decreased by 61% from 2000. The reduction in sales could be attributed
to the following:

1.  The management’s strategy to concentrate on the production of
    LCD-Multimedia or LCD-TV models to replace the Trinitron computer
    monitor models which were no longer ordered by major customers and
    to stop production of non-profitable Shadow mask models of computer
    monitors.

2.  Worldwide economic slowdown in particular the United States and
    Europe markets.

The Company reported a loss of Baht 770 million in 2002. Other than the
extraordinary loss, the loss was mainly due to the reduction in sales
and the gross margin was not enough to cover the minimum costs and
expenses even though a lot of efforts were made to reduce costs and
expenses.

Under the severe competitive environment in the industry, the Company’s
operating result for 2002 was not satisfactory. However, there were good
improvements in many other areas in comparison with 2001. Positive
changes carried out in 2002 includes investment in research &
development for new models, expanding new customer base, cost reduction
in fixed and variable elements, effective material disposals, inclusion
of existing stocks in new product designs, simplifying production
processes in TFT LCD monitors, setting up of an EMI chamber/TV signal
room for self-testing and enhancing local engineering skills by the
support from other related companies from Taiwan and Singapore. These
activities shall provide a reasonable foundation for the Company for
2003 onwards.

The directors are of the opinion that in 2003, the Company shall
continue to face a competitive environment. More and more manufacturing
bases have been relocated to Mainland China which has a cost advantage
over Thailand.

The market demands for CRT based monitors continues to decline and
probably will be phased out gradually with replacement of TFT LCD
displays. For the near / long term, the Company shall concentrate on its
product development and expansion of its customer base in LCD monitors
and LCD multi-media/LCD TV in order to be competitive and at the same
time earning a reasonable margin to the Company.