MIRA INFORM REPORT

 

Report Date :

27th February, 2007

                                                         

IDENTIFICATION DETAILS

 

Name :

ETHIOPIAN STEEL PLC

 

 

Registered Office :

Akakis Industrial Town, P.O. Box:  8692, Addis Ababa, Ethiopia.

 

 

Country :

Ethiopia

 

 

Date of Incorporation :

1997

 

 

Legal Form :

Private Limited Liability Company

 

 

Line of Business :

Manufacturers of galvanized corrugated steel sheets.

 

 

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 :

BIRR 2,500,000

 

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

Litigation :

Clear

 

 

COMpany NAME

 

ETHIOPIAN STEEL PLC

 

 

ADDRESS

 

Area                             :  Akakis Industrial Town

P.O. Box           :  8692

Town                 :  Addis Ababa

Country             :  Ethiopia

Telephone         :  (251 1) 342719 / 342720

Fax                   :  (251 1) 341940

E-Mail               :  ethsteel@telecon.net.et

 

 

SENIOR COMPANY PERSONNEL

 

Name                                        Position

 

Rakesh Betnager                       General Manager

 

 

Total Employees : 75

 

 

PAYMENTS

 

No complaints have been heard regarding payments from local suppliers or banks.

 

Subject is a member of the Bouchard group with operation throughout the African continent.

 

We consider it is acceptable to deal with subject for MEDIUM amounts, although it is normal accepted practice for international suppliers to deal on secured terms with Ethiopian importers.

 

Opinion on maximum credit : BIRR 2,500,000 (associations inspire confidence for higher amounts if required).

 

Trade risk assessment: Normal

 

Opinion on the credit figure of US DLRS 100,000:

 

 

PRINCIPAL BANKERS

 

NAME               : NATOINAL INTERNATIONAL BANK (NIB)

Branch              : Dembel City Center (6th Floor)

PO Box             : 2439

Town                 : Addis Ababa

Telephone         : (251 11) 150 3288 / 152 8340

Fax                   : (251 11) 152 7213 / 150 4349

 

 

The company also has an account with the following banks:

 

1. Awash International Bank SC

   Africa Road (Bole Road)

   near Bole International Airport

   P.O. Box :  12638

   Addis Ababa

   Telephone      :  (251 1) 614482 / 614483 / 614485 / 612919

   Fax                :  (251 1) 614477

   E-Mail            :  awash.bank@telecom.net.et

 

2. Wegagen Bank SC

   Denbel Building

   Bole Road

   P.O. Box :  1018

   Addis Ababa

   Telephone      :  (251 1) 523800 / 523552 / 655015

   Fax                :  (251 1) 523520

 

3. Commercial Bank of Ethiopia

   Dormant for the time being.

 

 

FINANCIAL INFORMATION

 

Balance sheets are not available. However, the subject interviewed offered the following information :

 

Sales Turnover               : BIRR    86,000,000 - 2003 - exact

                                    : not given          - 2004 - 2005

                                    : US DLRS 25,000,000 - 2006 - exact

 

Net Profit                       : not given          - 2003 - 2005 

                                    : BIRR     1,000,000 - 2006 - exact

 

 

LEGAL STATUS AND HISTORY

 

Date Started                  : 1997

 

License No.                   : 01/77.140.50/0350/91

 

Paid up Capital              : US DLRS 1,300,000

 

 

Private Limited Liability Company with the following sole shareholder :

 

Safal Investment (Pty) Ltd                         100 %

Mauritius

Member of the Bouchard group. Bouchard group is controlled by the Shah and Chandaria families and began operations in Kenya in 1928.

The group is reported to be the largest roof sheeting manufacturers in Africa, excluding South Africa. Bouchard began as steel processors and expanded to include trading in hot rolled coil, billet and wire rod. It also trades in cold rolled, galvanised, coloured and profile steels.

 

Affiliated companies of Ethiopian Steel Plc :

 

Associates

 

Subject is a member of the Bouchard group (Kenya headquartered) wich also includes the following :

 

1. Signode Packaging Systems Ltd.

   Nairobi

   Kenya

   Tel     : 011 433011/2/3 / 432346 

   Fax    : 011 433835 

        

2. Simba Steel & Aluminum Prodcuts Ltd.

   Uganda Baati Complex

   14/28 Kibira Road

   Kampala

   Uganda.

   Tel                 : 041-251857 

   Fax                : 041-251858

   E-mail            : ssapl@swiftuganda.com

 

3. Packaging Solutions (Tanzania) Ltd.

   PO Box 3117

   Dar-Es-Salaam

   Tanzania

   Tel                             : 861781 

   Fax                            : 861782 

   Mobile                        : 0812-785548

   E-mail                        : pstl@intertanzania.com

 

4. Safintra

   South Africa

 

5. Bouchard International

   Kenya

 

6. Mabati Rolling Mills

 

 

ACTIVITIES

 

The Company is involved in the following activities :

 

Manufacturers of galvanized corrugated steel sheets.

 

Imports from Asian, African and European countries.

 

 

FACILITIES

 

The Company has the following facilities :

 

Owned office premises and manufacturing units with integrated storage facilities at the heading address.

 

 

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/normal.

 

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