MIRA INFORM REPORT

 

 

Report Date :

14.08.2007

 

IDENTIFICATION DETAILS

 

Name :

P.T. JINDAL STAINLESS INDONESIA

 

 

Registered Office :

Kawasan Industri Maspion V, Jalan Alpha, Sukomulyo – Manyar, Gresik 61151

East Java

 

 

Country :

Indonesia

 

 

Date of Incorporation :

6 August 2004

 

 

Legal Form :

Limited Liability Company

 

 

Line of Business :

Stainless Steel Cold Rolling Milling  

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Maximum Credit Limit :

US$ 2,000,000

 

 

Status :

Satisfactory

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

Name of Company

 

P.T. JINDAL STAINLESS INDONESIA

 

 

Address

 

Head Office & Factory

Kawasan Industri Maspion V

Jalan Alpha, Sukomulyo - Manyar

Gresik 61151

East Java

Indonesia

Phone               - (62-31) 395-9565 (Hunting)

Fax.                  - (62-31) 395-9566

Land Area         - 10.75 hectares

Building Area     - 8,500 sq. meters

Region              - Industrial Estate Zone

Status               - Owned

 

 

Date of Incorporation

 

6 August 2004

 

                                  

Legal Form

 

P.T. (Perseroan Terbatas) or Limited Liability Company

 

 

Company Reg. No.

 

The Ministry of Justice and Human Rights

No. C-28482 HT.01.04.TH.2004

Dated 22 November 2004

 

 

Company Status 

 

Foreign Investment (PMA) Company

 

           

Permit by the Government Department

 

The Capital Investment Coordinating Board

- No. 513/I/PMA/2004

  Dated 3 August 2004

- No. 1018/III/PMA/2004

  Dated 14 October 2004

 

The Department of Finance

NPWP No. 01.869.622.9-055.000

 

 

Related Company

 

JINDAL STAINLESS Ltd., India  

 

 

CAPITAL AND OWNERSHIP

 

Capital Structure :

Authorized Capital                             : US$ 10,000,000.-

Issued Capital                                   : US$   7,500,000.-

Paid up Capital                                  : US$   7,500,000.-

 

Shareholders/Owners :

a. JINDAL STAINLESS Ltd,. of India    - US$ 7,499,900.-

    Address : Jindal Centre, 12

                    Bhikaiji Cama Place,

                    New Delhi 110066, India

b. JINDAL STRIPS Ltd., of India           - US$          100.-

   Address : Jindal Centre, 12

                   Bhikaiji Cama Place,

                   New Delhi 110066, India

 

                   

BUSINESS ACTIVITIES

                             

Lines of Business:       

Stainless Steel Cold Rolling Milling  

 

 

Production Capacity

 

Stainless Steel Cold Rolling - 50,000 tons p.a.

 

 

Total Investment

 

a. Equity Capital                                - US$   7.5 million

b. Loan Capital                                  - US$ 22.5 million

c. Total Investment                            - US$ 30.0 million

 

 

Started Operation

 

December 2004

 

 

Brand Name

 

None

 

 

Technical Assistance

 

SUMITOMO METAL INDUSTRIES Ltd., Japan

 

 

Number of Employee

 

170 persons     

 

 

Marketing Area

 

Export    - 45%

Local      - 55%

 

 

Main Customer

 

Buyers in Singapore, Malaysia, Thailand, India, China, South Korea, Australia, and local distributors

 

 

Market Situation

 

Very Competitive

 

 

Main Competitors

 

a. P.T. KRAKATAU STEEL

b. P.T. NAR STAINLESS STEEL

c. P.T. ESSAR INDONESIA

 

 

Business Trend

 

Growing

 

 

 

 

 

 

BANKER, AUDITOR & LITIGATION

 

Bankers :

a. STANDARD CHARTERED Bank

    Wisma Standard Chartered Bank

   Jalan Basuki Rachmat No. 83-85

   Surabaya, East Java

   Indonesia

b. Export Import Bank of India

    India

c. State Bank of India

    India

 

Auditor :

Internal Auditor

           

Litigation :

No litigation record in our database

 

 

FINANCIAL FIGURE

 

Annual Sales (estimated) :

2005 – Rp. 170.0 billion

2006 – Rp. 185.0 billion

 

Net Profit (estimated) :

2005 – (Rp. 5.5 billion)

2006 – Rp. 7.5 billion

           

Payment Manner :

Average

 

Financial Comments :

Satisfactory

 

 

KEY EXECUTIVES

 

Board of Management :

President Director          - Mr. Ashok Kumar Tyagi

Director                         - Mr. Umendra Pratap Singh 

           

Board of Commissioners :

Commissioner               - Mr. Ravinder Kumar Madanlal Goyal

                                                           

Signatories :

President Director (Mr. Ashok Kumar Tyagi) or the Director (Mr. Umendra Pratap Singh) which must be approved by Supervisory Board.

 

 

 

 

 

CAPABILITIES

 

Management Capability :

Good

 

 

Business Morality

 

Good

 

 

Credit Risk

 

Average

 

 

Credit Recommendation

 

Credit should be proceeded with monitor

 

 

Proposed Credit Limit 

 

Small amount – periodical review

 

 

Maximum Credit Limit

 

US$ 2,000,000 on 90 days D/A

 

 

OVERALL PERFOMANCE

 

P.T. JINDAL STAINLESS INDONESIA (P.T. JSI) was established in Surabaya, East Java on 6 August 2004 with an authorized capital of US$ 10,00,000.- issued capital of US$ 6,750,000.- of which paid up. The founding shareholders are JINDAL STAINLESS Ltd., and JINDAL STRIPS Ltd., both are of India. The notary deed has been changed, and in November 2004, the issued capital was raised to US$ 7,500,000.- entirely paid up. The deed of amendment was made by Mrs. Sitaresmi Puspadewi Subianto, SH, a public notary in Surabaya under Company Registration Number C-28482 HT.01.04.TH. 2004, dated November 22, 2004.

 

P.T. JSI is a foreign capital investment (PMA) company dealing with stainless steel cold rolling milling by taking over factory, machinery and factory employee of P.T. MASPION STAINLESS STEEL INDONESIA. P.T. JSI completed the acquisition of stainless steel cold rolling plant with capacity of 50,000 tons per year from P.T. MASPION STAINLESS STEEL INDONESIA, now know as P.T. JINDAL STAINLESS INDONESIA (P.T. JSI). The plant located at Kawasan Industri Maspion V, jalan Alpha, Sukomulyo – Manyar, Gresik, East Java, where it stands on a some 10.75 hectares landsite. After the acquisition, the plant has been operating since December 2004 and produced stainless steel cold rolling sheet of 50,000 tons per annum. The plant has absorbed an investment of US$ 30.0 million, come from owned capital of US$ 7.5 million and the rest come from loans. The plant using technology of SUMITOMO METAL INDUSTRIES Ltd., of Japan. The products are stainless steel for household, building material and fabrication industry like tank, pipe, utensil, and containers. The supplies of basic material in the form of hot band, steel in coil, steel shoot are mostly imported from India.

 

Some of 55% of its products is marketed locally to electronic and household appliances industry, fabrication industry, steel pipe industry and the rest 45% is exported to Thailand, Singapore, Malaysia, China, India, South Korea, Australia and other Asian countries. P.T. JSI is still classified as a medium-sized company in Indonesia and its business operation has been growing in the last two years.    

 

Generally outlook, the steel industry in Indonesia has kept on declining since end 1997 under the impact of economic crisis battering Indonesia. The crisis caused the demand of steel products to drop because property sector, steel construction sector, automotive and other sectors using steel in the country have been in sluggish. In next five years demand for steel industry will rise 5% annually. The economic growth has started increasing from 4.37% in 2002 to 4.87% in 2003 went up to 5.13% in 2004 and 5.78% in 2005. Several Indonesian economic indicators in 2000 to 2005 in details are as shown on table below :

 

The Growth of Indonesian Several Economic Indicators 2001-2005

 

No.

Indicator

2001

2002

2003

2004

2005

1.

Economic Growth (%)

3.83

4.37

4.87

5.13

5.78

2.

Inflation (%)

12.55

10.03

5.06

6.40

17.17

3.

Gross growth based on constant price 2000 (billion Rp)

1,442,984.5

1,506,124.4

1,579,558.9

1,660,578.8

1,753,903.0

4.

Foreign Trade Balance (million US$)

25,248.5

23,104.6

24,142.3

25,614.6

27.202.7

5.

Export (million US$)

56,321

57,159

61,058

71,585

83,314

6.

Import (million US$)

30,289

31,289

32,551

46,525

58,329

        Source :  Central Bureau of Statistic

 

Until this time P.T. JSI has not been registered with Indonesian Stock Exchange, so that they shall not obliged to announce their financial statement. We observed that total sales turnover of the company in 2005 amounted to Rp. 170.0 billion with a net loss of Rp. 5.5 billion, rose to Rp. 185.0 billion with a net profit of Rp. 7.5 billion in 2006. It is projected that total sales turnover of the company will be higher by at least 6% in 2007. We estimated the company has an estimated total net worth at Rp. 137.0 billion. The financial condition of the company is backed up by financially strong and sound foreign business partner behind it. So far, we have never heard of the company having been black listed by the Central Bank (Bank Indonesia). The company usually pays its debts punctually to suppliers.  

                                               

The management of P.T. JSI is headed by Mr. Ashok Kumar Tyagi (46), a professional manager of India who experienced for more than 11 years in the field of stainless steel cold rolling milling. We observed that management’s reputation in said business is fairly good. The management of the company is handled by experienced professional manager having wide relation with private businessmen of home and overseas as well as with the government sectors. So far, we have never heard that the company’s management involved in a dirty business practice or detrimental cases that settled in the country. The company’s litigation record is clean and it has not registered with the black list of Bank of Indonesia. PT. JINDAL STAINLESS INDONESIA is fairly good for business transaction. However, in view of the unstable economic condition in the country we recommend to treat prudently in extending a loan to the company.

 

                                                                                                                      


 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Unfavourable & favourable factors carry similar weight in credit consideration. Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

NR

In view of the lack of information, we have no basis upon which to recommend credit dealings

No Rating

 

 

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 and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

 

 

 

 

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