PROPERTY, MACHINE AND EQUIPMENT

VALUATION REPORT

Strictly confidential and private

Prepared By :_______________

Date:______________
38 November 2025
AAAA
General Manager
BBBBB Plc
Mexico square
Addis Ababa, Ethiopia.

Dear Ato AAAA,

Draft property valuation report

Pursuant to your instructions dated 50March 2025, we have undertaken the property valuation
of BBBB Plc, which are located at ADAMA City and BOLE-Kaliti sites.
The effective date of valuation is 50 June 2025 and the total Depreciated Replacement Cost
/FMV of buildings and civil works, process plant machinery and equipment, motor vehicles,
specialised equipment and office furniture and equipment of the Company, as are more
particularly described in the above report and accompanying schedules was ETB
1,501,770,718 (Four Hundred One Million Eight Hundred Seventy Thousand and Seven
Hundred Eighteen).
The Exchange Rate as at the date of valuation was 1US$: ETB 15.82

Market Value is the estimated amount for which a property or an asset should exchange on
the date of valuation between a willing buyer and a willing seller in an arm’s-length
transaction after proper marketing wherein the parties had each acted knowledgeably,
prudently and without compulsion.’’.

Yours Faithfully

AAAA

Contents
1. Instruction 3
2. Factual Data 3
3. Purpose of Valuation 4
4. Date of Valuation 4
5. Scope of Valuation 4
6. Definition of Values 5
7. Inspection and Verification 5
8. Title Certificates 6
8.1. Land and Buildings Title Certificates 6
8.2. Motor Vehicles Title Certificates 6
9. Description of Assets 6
9.1. Description of Buildings and Civil Works 6
9.2. Description of Process Plant Machinery and Equipment 9
9.3. Description of Motor Vehicles 11
9.4. Description of Office Furniture and Equipment and Specialised Equipment 11
9.5. Construction in Progress 11
10. Valuation Process and Methodology 12
10.1. Steps for Depreciated Replacement Cost (DRC) Estimation 13
10.2. Caveats 20
11. Valuation Certificate 21
11.1. Summary of Values 21
11.2. Exchange Rate 21
11.3. Valuation Certificate 21
12. Appendices 22

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1. Instruction

The valuers / henceforth called the trainees/are instructed to report on the valuation of fixed
assets of Bishoftu Automotive Industry(henceforth called the Industry) comprising of buildings
and civil works, process plant machinery and equipment; specialised equipment, motor vehicles,
office furniture and equipment, as are more particularly described in the report and schedules
hereto.The survey and valuation have been conducted by trainees in order to confirm and certify
compliance to internationally accepted valuation standards, practices and procedures.

2. Competency of Valuer
This report was completed by traineesis presently designated as an MRICS, awarded by the
Royal Institution of Chartered Surveyor. Further, this designation is held by appraisers who are
experienced in the valuation of commercial, industrial, residential and other types of properties;
and who advise clients on real estate investment decisions. Mr. AAA has completed numerous
valuation assignments on properties and has the experience and ability to complete the valuation
assignment in a competent manner. For a more detailed description of the valuer’s qualifications,
refer to the Addendum section of this valuation.

3. Background Information

3.1. Establishment

Project 40720/currently named Bishoftu Automotive Industry established in 1984 to overhaul

medium repair of armoured and automotive parts, communication equipment’s, maintain
radar stations and anti-air craft guns. From 1991 up to 2008 the project works finalize and the
industry started overhauling tanks and Ural military trucks. In 2008 the industry reorganized
under Defence Industry Sector named as Bishoftu Motorization Engineering Complex
Established in 1999.
Later in 2010 it re-established and re-named as Bishoftu Automotive Industry (BAI) while it
incorporated into the Metals and Engineering Corporation. Located 45 km East of Addis
Ababa, in the town of Bishoftu, BAI assembles public transportation buses, inter-city buses,
heavy duty trucks, pick-ups, small vehicles and multi-purpose military vehicles.In addition to
producing and supplying automotive products it is also working on the expansion of modern
automotive technology as well as related production facilities owned by private enterprises.

3.2. Vision of BAI

● To become a competitive automotive industry in the global market.

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3.3. Mission

● Lead the industrial development of Ethiopia in the automotive sector.

3.4. Production Factories

1. Light vehicle production factory,

2. Heavy duty truck production factory,
3. Power train production factory,
4. Vehicle system production factory,
5. Body and frame production factory
6. Tank and armoured vehicle production factory
7. Painting factory
8. Bus production factory

3.5. Main Products

1. City bus 12m and 18m

2. Intercity bus 12m,
3. Intercity Mid bus and city mid bus
4. Pickups, double and single cabin
5. SUV (station wagon)
6. Dump truck
7. Water and fuel truck
8. Cargo truck
9. High bed and low bed
10. Mixer drum
11. Tank and armored vehicles
12. Mini trucks(2,3,5 ton)
13. All types of truck cabins

4. Factual Data

The fixed assets like the Buildings and infrastructures, plant and machineries, motor vehicles
which are found at the compound of Bishoftu Automotive Industry; the office furniture found
with in Gold Mark International hotels and Computers on the hand of Trainees. In addition to
theses the hypothetical assignment the G+3 building found in Bishoftu Town.

The manufacturing plant of the company is located 3 kilometres from the main import-export
transport corridors which pass through Bishoftu Town. The immediate neighbourhoods of this
property are: farm landsto the south and the east,road to the north.

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5. Purpose Valuation
The purpose of the valuation is to estimate the fair market value of the assets for adopting
International Financial Reporting Standard (IFRS) . The valuation report was prepared and
intended for the sole use of the Client to assist the Client in preparing its decision as the intended
use only and is not intended for use by any other party or for any other purpose. Any party that
attempts to utilize this report without the written permission of the valuers does so at their own
risk. Be advised that this report was prepared for the Client and that the valuers do not intend to
influence any third party’s decision regarding potential investment.
This report will be provided for the stated purpose and for sole use as the named client. It is
confidential but you may show it to your professional advisers. We hold the copyright to the
report and you must not copy it or pass it on to anyone without our written approval. Anyone
else who relies on the report does so at his or her own risk.

6. Date of Valuation

The date of the valuation is May 31/2017.

7. Scope of Valuation
The scope of the assignment relates to the extent and manner in which research is conducted,
data is gathered and analysis is applied, all based upon the following problem-identifying factors
stated elsewhere in this report:
 Client
 Qualification of valuer
 Intended use
 Intended user
 Type of opinion
 Effective date of opinion and
 Relevant characteristics about the subject
The scope of the valuation was collection of primary and secondary data relative to the fixed
assets. In the context of completing this report, we have made a physical inspection of the subject
properties. The valuation process involved utilising market-derived and supported techniques
and procedures considered appropriate to the assignment. Generally, the scope of the valuation
encompasses the necessary research and analysis to prepare the report in accordance with the
intended use. The steps typically involved in the valuation process are as follows:

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1. The subject fixed assets were physically inspected during 26 to 29 June 2017 as of the date
indicated in the Inspection and Verification section of this report. Photographs included in
this report were taken on the date of inspection.
2. Newly constructed building was based on information gathered from various sources from
sub-contractor of building, administrative, technical staffs.) as well as the valuer's physical
inspection and analysis of the area.
3. Data related to the subject fixed assets were based on the valuer's physical inspection of the
improvements, as well as building plans and or site information supplied by management of
the Company, measurements made during the inspection, and information extracted from the
asset registers as well as other similar documentation.
In developing applicable approaches to the valuation, the valuer analysed market data
relevant to the subject. Sales data for improved properties and leases similar to the subject
were researched from a variety of sources, including government agencies, appraisers and
sellers. However, the valuer could not access sufficient information from these sources. To
this end, the Cost Approach was used to value the properties.
This report sets out the findings and conclusions of the valuers (trainees) based on an
investigation of conditions affecting the value and is subject to the Caveats and Definitions
which are included in the report. Without reading the Caveats and Definitions, the report
cannot be fully understood.

8. Definition of Values

a. Market Value is the estimated amount for which a property or an asset should exchange on
the date of valuation between a willing buyer and a willing seller in an arm’s-length
transaction after proper marketing wherein the parties had each acted knowledgeably,
prudently and without compulsion.
b. The Gross Replacement Cost (GRC) of a building is the estimated cost of erecting the
building, or modern substitute having the same gross internal area as that existing, and the
ancillary site works together with the relevant professional fees and other associated
expenses directly related to the construction of the building and site works.
c. The Gross Replacement Cost (GRC) of an asset is the estimated cost of acquiring and
installing a new asset, or a modern equivalent substitute asset, together with the associated
expenses directly related to the installation of the asset.
d. The Depreciated Replacement Cost (DRC) of a building or an asset is the Gross Replacement
Cost depreciated according to age, obsolescence, use and condition. This value is only
applied to assets which are part of an operation and does not necessarily represent the Market
Value.

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9. Inspection and Verification

The valuer carried out physical inspection and verification of some sample assets (buildings and
civil works, plant, machinery and equipment (property of trainees), and motor vehicles) located
at Bishoftu Automotive Industry except the building located in Bishoft Town. . The inspection
was madeto verify that the building, plant machinery and equipment do exist and are working.
The equipment were observed and are assumed to be in good working order though a detailed
mechanical inspection was not undertaken. The property inspection and verification was carried
out during27 to29 May 2017. The data collected during the inspection and verification works
include the following:
Buildings and other civil works:- The type of construction material, construction stages, the
characteristics of the surrounding area, sizes, shapes, characteristics of the buildings, age, layout, clear
floor space, air conditioning, flexibility for internal alteration, floor to ceiling height, parking standard
and measurements of building area have been taken. These were used for determining the condition
factorof the buildings under consideration. Relevant data was also taken for other civil works.
Plant and Machinery: The make/brand, capacity, age, attachments and auxiliary items, degree
of use for the service, presence of skilled labour, operating expenses of the subject machinery
and modern substitute, and other relevant specification for each machinery and equipment have
been collected. But repair and maintenance history not found.
Motor Vehicle:The make, model, age, plate number, motor number, chassis number, title
certificate, technical condition, types of vehicles, country of origin and other relevant data have
been collected.
Office Furniture and Equipment and Specialised Equipment/Tools: The physical condition
(deterioration) and functionality of the assets have been inspected.

10. Title Certificates

10.1. Land and Buildings Title Certificates

The title deed certificates for the land holdings is not found , be we have recognized that the land
is the property of the factory .

10.2. Motor Vehicles Title Certificates

The valuer was able to verify the Company’s ownership of the vehicles from the title certificates
issued by the responsible government organisation.

11. Description of Assets

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11.1. Description of Buildings and Civil Works

The assignment is include Tank and armoured vehicle production hall, but the assumption is
to change the Heavy Truck Assemply hall and the building which is hypothetically found in
Bishoftu Town. the production hall This report explains the construction details of major
improvements found in the occupation which have significant impact on the valuation result.

1. Tank and armoured vehicle production hall; -the building is built in 1984 and itb is in
good condition. The structural parts of this manufacturing halls is RC concrete column
and beam I-section Steel structures of top tie beam and roofing. The foundation work of
the hall is heavy concrete to bear the load which comes from the operations. The columns
are connected to emerge from foundation column which is padded by 2.7m*2.7m isolated
footing pad.The floor of the hall is RC slab which is painted on pepoxin chemical; the
wall is HCB plastered and painted some parts and Egga sheet others which is fixed with
steel structure; roofing is covered by EGGA sheet in 1998 which was asbestos before, the
roof has natural light transparent; the building has two sliding metal sheet doors and
small glass windows, also has CHS downpipe and egga sheet gutter and sewerage
drainage system around the building and Industrial electric installation system. The
building is special kind of construction which has underground tunnels but the tunnels are
not functional currently.
2. Production office to hall; -this building built in 1984 which is annexed to the hall and
structural parts is RC concrete column and beam I-section Steel structures of top tie beam
and roofing. The foundation work of the hall is heavy concrete to bear the load which
comes from the operations. The columns are connected to emerge from foundation
column which is padded by 2.7m*2.7m isolated footing pad. The floor of the hall is RC
slab which has concrete tiles from ground to first floor and ceramic tiles for second floor;
the wall is HCB plastered and painted for ground to first floor and brick wall and more
glassing for second floor.; roofing is covered by EGGA sheet, also has CHS downpipe
and egga sheet gutter and seweragedrainage system around the building and Industrial
electric installation system.
3. Renting house;- it is assumed that the building is comfortable and affordable to live.

Figure 2: Partial View of Manufacturing Hall for Expansion Plant

Figure 3: Partial Viewof Manufacturing Hall for Existing Plant

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11.2. Description of Process Plant, Machinery and Equipment
1. Heavy truck assembly plant; contains eight assembling sections like Section-1: Suspension
systemassembly; Section-2: deferential and propeller- shaft assembly; Section-3: Chassis
turn over accessary ; Section-4: Air pipe line engine mount; Section-5:Radial and engine
accessary; Section-6:Cabin mount; Section-7: Lubrication and tyre assembly and Section-8:
finding adjustment . All sections have operated their on activities by the helps of common
implements like reversible conveyor, hoists, electric control panel and others.

Assembly plants generally are considered less risky business because they usually assemble the
imported products , required maintenance schedules, government regulations, alternative energy
sources, and local and global economic activity. The commodity market can be cyclical or seasonal,
and generally is unpredictable. Assembly plant typically utilise technologically complex and
expensive machinery and equipment. The plant installed and commissioned during 2012 to 2013
were better in technological advancement as well as layout .the plant is very good condition.

Fig. 5:heavy truck assembly

2. Hydraulic press;this machinery used to change the shape of metal sheet and ditching the
attached product implements of armored vehicles. The press has 3150kg pressing capacity
and has components like oil tank, control panel and 23kw motor. One press machine is in
very good condition and other machine assumed that has no business contribution to the
factory.

Fig. 6: Hydraulic press

11.3. Description of Motor Vehicles

The sample of motor vehicle is double cabin pick up, which is assembled in the factor in 2012.
The motor vehicle is good condition. .

11.4. Description of Office Furniture andEquipment and Specialised Equipment

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Items in this category of fixed assets include office furniture and equipment such as computers, ,
tablesandchairs . Most of these fixed assets weregenerally in a good to very goodcondition while
some equipment is in a poor to fair condition.

12. Valuation Process and Methodology

The valuation process that the valuer/trainnes followed contains all the steps necessary for this
type of assignment. The valuation process also establishes the methodology for estimating many
other forms of value. A specific series of procedures constitutes the valuation process; the
application of these procedures depends on the type of the property under consideration, nature
of the valuation assignment and the data available.

Traditional valuation theory applies three approaches to arrive at an estimate of value. The
foundations for these approaches are Cost, Sales Comparison and Income. One or more
approaches to value may be used depending on their applicability to the particular valuation
assignment. All three approaches are applicable to many valuations but one or more of the
approaches may have greater significance in a specific assignment. Wherever possible, the valuer
applies the approach or approaches deemed most appropriate in order to arrive at a final value
estimate.

The valuation approach utilised to estimate the value of the subject properties was selected based
on the analysis and knowledge of the nature and types of the subject propertyand availability of
data (i.e,. property sales data, land lease price data, income data, cost data etc). It is the valuers’
opinion that due to the availability of data, the Cost Approach would be considered meaningful
and applicable in developing a credible value conclusion.

12.1. Steps for Depreciated Replacement Cost (DRC) Estimation

The Cost Approach is based upon the proposition that an informed purchaser would pay no more
for the subject than the cost to produce a substitute property with equivalent utility. In other
words, Cost Approach is based on the principle of substitution, which states that no prudent
person will pay more for a property than the cost of acquiring a site and constructing, without
undue delay, an equally desirable and useful property. This approach is particularly applicable
when the property being appraised involves relatively new improvements, or when relatively
unique or specialised improvements are located on the site, for which there exist few sales or
leases of comparable properties or the legal framework of the country may enforce the use of this
approach.

In the Cost Approach, the valuers forms an opinion of the cost of all fixed assets and
depreciating them to reflect value loss from physical, functional and external causes. The Land
value (based on the country law i.e., constitution, proclamation, regulation and directive) is not
considered in this valuation.

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The cost approach is used to estimate the value of property based on the current cost of the
subject assets, minus physical deterioration, functional obsolescence, and economic
obsolescence. In the cost approach, an analysis must be made of the property that is actually and
physically being appraised, with consideration given to its design capacity and utilisation, its
physical condition and its operating characteristics as compared with a new modern facility. This
approach also requires an analysis of the economics of the plant and its industry.

The valuers utilises all of the above engineering and market information to develop a cost
approach indication of value. The cost approach is the only indicator of value that identifies and
values only the tangible assets; it does not include any intangible assets. In this approach, the
maximum value of a property to a knowledgeable buyer is the amount currently required to erect
or construct a new plant of equal utility, i.e., the new replacement cost. Because the assembly
plant subject to valuation typically is not new, the new cost must be reduced by the impact of all
of the forms of depreciation (physical deterioration, functional obsolescence, and economic
obsolescence) attributable to the property at the valuation date.

To this end, the Depreciated Replacement Cost of fixed assets of the company has been
determined by estimating the Gross Replacement Cost New, Condition Factor (reciprocal of total
depreciation), Economic Remaining Life, Theoretical Useful Life and Depreciation Factor of the
fixed assets. The details of the approach are presented in the following sections.

10.1.1 Estimation of Gross Replacement Cost (GRC)

10.1.1.1 Buildings and improvements:
Base Building Costs
Itincludes all direct costs for the buildings and the following indirect costs:
● Plans, specifications, and building permits, including engineer's and architect's fees;
● Contractor's overhead and profit, including workers’ compensation, fire and liability
insurance, etc.

Amenities and Site Improvements

The various amenities and site improvements are not included in the building costs. These items
include amenities, paving, signs, site improvements, landscaping, etc. and the value of these
items have been treated one by one.
For the purpose of this valuation, the direct costs of buildings for major buildings have been
estimated by civil engineer using bill of quantity method. However, the costs per square metres
of similar buildings and improvements have been adopted from the valuer’s database and
contractors for minor buildings and all improvements.

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10.1.1.2 Process plant machinery and equipment
The GRC for plant machinery and equipment have been estimated based on two methods. Cost-
to-Capacity method was applied when the valuer obtained a replacement cost new for similar
machinery but with different capacity. On the other hand, a Trending Method was adopted when
the valuer was not able to get replacement cost new from the market or the capacity variation
between the subject property and the machinery in the market is high.
Cost-to-Capacity: In this case the costs of similar plants or pieces of equipment of different sizes
vary with the size raised to some power. This relationship can be expressed mathematically as
follows:
x
C2 Q2
[( )] [( ) ]
C1
=
Q1
Here, C2 is the desired cost of capacity Q2 and C1 is the known cost of Capacity Q1. A frequent
value for x is 0.6. The valuer has estimated the capacity of the desired cost by discussion with
technical staffs of the Company as there was no any maintenance and operational manual for all
process plant and machinery in the Company. In addition to the capacity of the desire cost, the
valuer searched the cost and capacity of similar machinery from the sub-market to utilise the
above formula. Once all these three parameters were determined the unknown/desired cost of the
machinery has been estimated.

When the valuer was not in a position to get similar machinery in the market then the Trending
Method was applied by using the historical cost of the subject property. Trending is a method of
estimating a property’s reproduction cost new (not replacement cost new) in which an index or
trend factor is applied to the property’s historical cost to convert the known cost into an
indication of current cost. In Ethiopia it is very difficult to get an index for a specific process
plant and machinery. Hence, the valuer used the growth rate of the exchange rate of USD (United
State Dollar) to Ethiopian Birr as a trend factor to estimate the GRC. In this report, historical cost
is the cost of a property when it was first placed into service by its first owner. This is to be
distinguished from original cost, which is the initial cost of a property in the hands of its present
owner, who may not be the first owner and who may have purchased at a price greater or less
than the historical cost. Original cost may be the used cost of the property, whereas historical
cost can never be a used cost. When trending, trend factor is applied to the property’s historical
cost, not original cost.The data for historical costs of the machinery has been collected from the
asset register of the company.

10.1.1.3 Office FurnitureandEquipment and Specialised Equipment

The GRCs for office furniture and equipment and specialised equipment were obtained from the
local market and the valuer database. The valuer has been searching the prices for those items
which have not been found in his database. The data from market and valuer’s database has been
taken as the GRC for the assets under this category.

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10.1.2 Accrued/Total Depreciation for Building, Plant Machinery and Equipment
There are three sources of accrued depreciation which are presented below:

10.1.2.1 Physical Deterioration

The physical deteriorations of the building and machinery of the company have been determined
through observation method. In this method, the valuer carried out a comparison based on
personal experience gained by looking at similar properties and comparing them to new
properties. The procedure used wasby observing those elements of wear and tear that can be seen
and converting those observations into a percentage. The valuer discussedtechnical issues with
knowledgeable personnel to determine the condition of those aspects that might not be readily
apparent.In addition, the valuer tried to review the maintenance history of the subject buildings
and machinery. On the basis of these facts and information, the valuer developed an opinion of
physical deterioration, which is indicated in the spreadsheet schedule of building, plant
machinery and equipment, to deduct from replacement or reproduction cost new.

10.1.2.2 Functional Obsolescence

Functional Obsolescence is resulting from two sources: from excess capital cost and excess
operating expenses. Excess capital cost is measured by calculating the difference between
reproduction and replacement cost. The functional obsolescence for all improvement (buildings
and civil works) is considered to be 0.00 percent. This is because, the construction of the subject
improvements utilising modern materials and current standards, design and layout, and then
functional obsolescence due to both excess cost and operating expenses are not applicable.

In the case of the processplant and machinery, the valuer was unable to estimate the difference
between reproduction and replacement cost due to lack of data to estimate these two parameters.
Hence, the valuer assumed that the functional obsolescence as a result of excess capital cost is
considered to be 0.00 percent. On the other hand, the process plant which was installed and
commissioned during 2012 and 2013 are modern, which meet current standards, design and
layout. To this end, the functional obsolescence due to excess operating expense is assumed to be
0.00 percent. On the contrary, the process plant which were installed and commissioned during
2005 and 2006 are technologically obsolete. As a result of this, the existing property or facility
and its higher operating expenses are compared to the reduced expenses that could be achieved
by the modern replacement facility. Therefore, the valuer estimated the functional obsolescence
due to the excess operating for all process plants which were installed and commissioned during
2005 and 2006. This estimation was made based on the discussions made with technical,
production and finance personnel of the Company and the experience of the valuer.

10.1.2.3 External Obsolescence

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Regarding the demand side of the finished products of the company as well as the supply sides of
raw materials and other issues in the industry, there is no significant problem that negatively
affects the operation of the Company. Therefore, the economic/external obsolescence for both
buildings and machinery is considered to be 0.00 percent.

10.1.2.4 Total Depreciation

The sum of the above three elements of accrued depreciation is presented in the spreadsheet
schedulesfor all buildings and plant machinery and equipment.

10.1.3 Condition Factor (CF) Assessment for Motor Vehicles

The condition factors of motor vehicles are determined mainly based on the make, model, age,
physical condition, types of vehicles (automobile, pickup, trucks, bus, etc) and country of origin.
The physical condition of each motor vehicle was determined by physical inspection of the
vehicle and discussion with the Company’s technical personnel.

10.1.4 Condition Factor (CF) Assessment for Office FurnitureandEquipment and

Specialised Equipment
The condition factor/rate assessment of office furniture andequipment mainly depends on the
physical condition (deterioration) and functionality of the assets. The condition ratings for these
assets are defined as follows:

10.1.5 Depreciation Factor (DF) Estimation for Buildings and Process Plant and
Machinery

The DF is calculated by taking the ERL as a nominator and the maximum of TUL or Total
Useful Life (ToUL) as a denominator. ToUL is the sum of the ERL and Age of the asset.

ERL
DF=
( Max(TUL;ToUL )
Where:
DF is the Depreciation Factor
ERL is the Economic Remaining Life of the asset
TUL is the Theoretical Useful Life of the asset
ToUL is the Total Useful Life of the asset;
Max (TUL; ToUL) is the maximum of the Theoretical Useful Life or Total Useful Life

10.1.6 Depreciated Replacement Cost (DRC) Estimation

10.1.6.1 DRC Estimation for Building,Process Plant Machinery andEquipment

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The DRC estimation for buildings, process plant machinery andequipmentwere carried out using
the following formula.
DRC=GRC∗DF
Where:
DRC is the Depreciated Replacement Cost
GRC is the Gross Replacement Cost
DF is the Depreciation Factor (computed by dividing the sum of all obsolescence by
replacement/reproduction cost)

10.1.6.2 DRC estimation for Office Furniture andEquipment and Specialised Equipment

The DRCfor office furniture andequipmentwasdetermined by adjusting the costs of new similar
items by factors that reflect the conditions of the items. Once the condition factor is estimated,
the DRC can be determined by multiplying the condition factor by the corresponding GRC:

DRC=CF∗GRC

10.1.7 Land Lease Value

For this specific valuation report, the valuer took the difference between land lease value which
was paid by the Company in advance and the accumulated amortisation of land. This value is
ETB894,880 (1,118,600-223,720), which is indicated in the lease contractual agreement made on
03 April,2012.

On the other hand, if an investor secures a land from Regional Government for investment
purpose, the current minimum/floor land lease price per square metre for Adama City is ETB
18.75. However,AAA PLC has secured the land with a lesser amount as compared to the current
floor land lease price (which is indicated in Table 3). As a result of this, AAA PLCsecured a total
land value of ETB 125,204,178 for all occupations over and above theirpurchased price. This
land value has not been included in this valuation report.

Table 3: Current Floor/Minimum Land lease Price and Purchased Price Comparison

12.2. Caveats

The Valuer’s valuation has been completed subject to the following caveats. The valuers:

● has not undertaken a structural survey of any building and civil works nor has he arranged for
tests or inspections to be carried out on any of the service installations.

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● has assumed that the land, buildings and civil works are fit for the purpose for which they
shall be used and comply with all statutory and local bye-laws and regulations.

● is not aware of any proposed works which would affect the value of the fixed assets.

● has assumed that there are no restrictive conditions that may be inserted in any lease or title
to the land that would adversely affect the value of the property.

● has not taken into account any possible benefits from participation in any national or
international aid, loan, grant or similar scheme for which the Company may be eligible.

● has not arranged for nor carried out any mechanical or electrical tests on any of the
equipment included in this report, limiting his examination to the outward physical
appearance and to information received as to the history and condition of the assets.

● has assumed that the business will continue in operational existence for the foreseeable future
and that there is neither an intention nor necessity to liquidate or curtail significantly the
scale of operation.

● has assumed that foreign currency would be available at current exchange rates for the
purchase of imported assets.

● has determined the physical condition in most instances by observation or indication by

others. Any unknown conditions existing at the time of inspection could alter the value. No
responsibility is assumed for latent defects of any nature whatsoever which may affect value,
nor for any expertise required to disclose such conditions.

● has not made additional values in regard to such intangibles as patents, rights to manufacture,
trademarks, goodwill, going concern value, etc.

● has assumed assume no responsibility for economic or physical factors which may affect the
opinions in this report occurring after the date of the letter transmitting the report.

● has based his opinion of value on certain assumptions that have been presented to him. If
these basic assumptions should change for any reason, the final valuation could quite likely
change. The appraiser reserves the right to make any adjustments considered necessary as
additional or more reliable data becomes available.

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13. Valuation Certificate

13.1. Summary of Values

Table 4: The DRC, and MV Valuations Summary

S/N Description DRC /MV (ETB) DRC/MV
1 Building and Infrsture /METEC/ 13,070,309 13,070,309
2 Building Bishofitu (town) 46,006,184 46,006,184
3 Plant and machinery 204,836,348 204,836,348
4 Motor Vehicles 350,000 350,000
5 Office furniture 84,420.00 84,420
6 Sub total 217,991,076 46,356,184 264,347,260
7 Scrape Machinery 133,794 133,794
Grand Total 217,991,076 46,489,978 264,481,055

13.2. Exchange Rate

The Exchange Rate as at the date of valuation was 1USD: Ethiopian Birr 23.0798 @ 29 may
2017.

13.3. Valuation Certificate

It is the Valuer’s opinion that as at31May 2017 the total Depreciated Replacement Cost /MV of
buildings and civil works, process plant machinery and equipment, motor vehicles, specialised
equipment and office furniture and equipment of the industry , as are more particularly described
in the above report and accompanying schedules was ETB264,481,055(Two Hundred Sixty
Four Million , Four Hundred Eighty One , fifty Five/ .

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14. Appendices
11.1 LandTitle deed certificate

11.2 Motor Vehicle Title Certificate

11.3 Schedules of Fixed Asset

11.3.1Building & Civil Works

11.3.2 Plant & Equipment

11.3.3 Motor vehicle

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