MIRA
INFORM REPORT
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Report Date : |
28.01.2008 |
IDENTIFICATION
DETAILS
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Name : |
HENAN TONGZHOU COTTON TRADE CO., LTD. |
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Registered Office : |
15/F, Qinghua International Bldg., No. 9, North Jingyi Road, Jinshui Dist,
Zhengzhou City, Henan Province 450003 |
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Country : |
China |
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Financials (as on) : |
31.12.2006 |
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Date of Incorporation : |
10.01.2000 |
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Com. Reg. No.: |
4100002007329 |
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Legal Form : |
Limited Liabilities Company |
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Line of Business : |
Company is engaged in Selling Cotton |
RATING &
COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
Small |
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Maximum Credit Limit : |
USD 80,000 |
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Status : |
Small Company |
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Payment Behaviour : |
No Complaints |
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Litigation : |
Clear |
COMPANY NAME & ADDRESS
HENAN TONGZHOU COTTON TRADE CO., LTD.
15/F, QINGHUA INTERNATIONAL BLDG., NO. 9, NORTH JINGYI ROAD, JINSHUI DIST,
ZHENGZHOU CITY, HENAN PROVINCE 450003 PR CHINA
TEL: 86 (0) 371-65836219
FAX: 86 (0) 371-65836214
EXECUTIVE SUMMARY
INCORPORATION DATE : jan. 10, 2000
REGISTRATION NO. : 4100002007329
REGISTERED LEGAL FORM : limited
liabilities company
CHIEF EXECUTIVE :
Mr. wei gangmin (chairman)
STAFF STRENGTH :
80
REGISTERED CAPITAL : CNY 10,000,000
BUSINESS LINE :
trading
TURNOVER :
cny 456,590,000 (AS OF DEC. 31, 2006)
EQUITIES :
CNY 9,720,000 (AS OF DEC. 31, 2006)
PAYMENT :
AVERAGE
RECOMM. CREDIT RANGE : up to usd 80,000
MARKET CONDITION : average
FINANCIAL CONDITION : fairly stable
OPERATIONAL TREND : FAIRLY steady
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE :
CNY 7.20 = US$1
Adopted
abbreviations:
ANS - amount not stated
NS - not stated SC - subject
company (the company inquired by you)
NA - not available
CNY - China Yuan Ren Min Bi
SC was registered as a limited liabilities company at local
Administration for Industry & Commerce (AIC-The official body of issuing
and renewing business license) on Jan. 10, 2000.
Company Status: Limited liabilities co. This form of business in PR China is defined as a legal
person. No more than fifty shareholders
contribute its registered capital jointly. Shareholders bear limited
liability to the extent of shareholding, and the co. is liable for its
debts only to extent of its total assets. The characteristics of this form
of co. are as follows: Upon the establishment of the co., an investment
certificate is issued to the each of shareholders. The board of directors is comprised of three to thirteen
members. The minimum registered capital for a co. is CNY 30,000. Shareholders may take their capital contributions in cash
or by means of tangible assets or intangible assets such as industrial
property and non-patented technology. Cash contributed by all shareholders must account for at
least 30% of the registered capital. Existing shareholders have pre-exemption right to purchase
shares of the co. offered for sale by the other shareholders and to
subscribe for the newly increased registered capital of the co.
SC’s registered business scope includes selling lint cotton, chemical fibers,
cotton yarn, and textiles; importing and exporting commodities &
technologies.
SC is mainly engaged in selling cotton.
Mr. Wei Gangmin has been chairman of SC since 2000.
SC is known to have approx. 80 staff members at
present.
SC is currently operating at the above stated address, and this address
houses its operating office in the commercial zone of Zhengzhou. Our checks
reveal that SC rents the total premise about 2,000 square meters.
http://www.hntzmy.com.cn The
design is professional and the content is well organized. At present the web is
both in English and Chinese versions.
E-mail: tzmy@hntzmy.com
No significant events or changes were found during our checks with the
local AIC.
MAIN SHAREHOLDERS:
Name %
of Shareholding
Wei Gangmin 93
Li Yinping 7
Chairman and General Manager:
Mr. Wei Gangmin , in his 40’s with university education. He is currently
responsible for the overall management of SC.
Working Experience(s):
From 2000 to present Working in SC as chairman and general
manager.
SC is mainly engaged in selling cotton.
SC’s products mainly include: cotton, chemical fibers, etc.
SC sources its materials 45% from domestic market, mainly Jiangsu and
Henan, and 55% from overseas market, mainly America, Singapore, France, and
India; SC sells its products 100% in domestic market, mainly Henan.
The buying terms of SC include T/T, Check, L/C, and Credit of 30-60
days. The payment terms of SC include T/T, Check and Credit of 30-60 days.
*Major Supplier:
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Wuxi Hongxing Textile Co., Ltd.
*Major Customer:
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Shangcai Huabao Textile Co., Ltd.
SC is known to have a subsidiary at present, at present:
Xuchang Herun Textile Co., Ltd.
Address: Liuyin Road, Development Zone, Yanling County,
Henan
Tel: 0374-7162290
Overall payment appraisal:
( ) Excellent ( ) Good (X) Average
( ) Fair (
) Poor ( ) Not yet determined
The appraisal serves as a reference to reveal SC's payments habits and
ability to pay. It is based on the 3
weighed factors: Trade payment experience (through current enquiry with SC's
suppliers), our delinquent payment and our debt collection record concerning
SC.
Trade payment experience : A trade enquiry
currently conducted with SC's supplier(s) reveal the following:
Supplier A
Products sold :
cotton
Date account opened :
2005
Line of credit :
No comment
Terms : Cash on
delivery, T/T, Credit of 30 days
Average monthly sales :
No comment
Current balance :
No comment
Rating Key :
3
Any Special Comments :
______________________________________
Payment record keys :
1 = Prompt : Payment made before the credit period expires
2 = As agreed terms : Payment made upon due date
3 = Slightly slow but acceptable : Payment made 5 to 20 days beyond
agreed terms
4 = Slow : Payment made 16 to 45 days beyond agreed terms
5 = Poor : Payment made over 45 days beyond agreed terms
6 = No comment : Account is newly opened & record is not yet
established
Note : In some instances, payment beyond
terms can be the result of disputes over merchandise, lost invoices, disputed
accounts & etc.
Delinquent payment record: None in our database.
Debt collection record: No overdue amount owed by SC was placed to us for
collection within the last 6 years.
Agricultural Development Bank of China Zhengzhou Branch
AC#: 20341010500100000113941
Relation: Normal
Balance Sheet (as of Dec. 31, 2006)
Unit: CNY’000
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Cash & bank |
189,550 |
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Inventory |
121,030 |
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Accounts receivable |
0 |
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Other Accounts receivable |
0 |
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Advances to suppliers |
140,380 |
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To be apportioned expense |
0 |
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Other current assets |
2,600 |
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Current assets |
453,560 |
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Fixed assets |
2,330 |
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Long term investment |
2,680 |
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Other assets |
10 |
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Total assets |
458,580 |
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Short loans |
6,900 |
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Bills payable |
376,500 |
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Accounts payable |
0 |
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Advance from clients |
6,260 |
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Other Accounts payable |
12,080 |
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Withdraw the expenses in advance |
0 |
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Other current liabilities |
47,120 |
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Current liabilities |
448,860 |
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Long term liabilities |
0 |
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Other liabilities |
0 |
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Total liabilities |
448,860 |
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Equities |
9,720 |
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Total liabilities & equities |
458,580 |
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Income Statement (as of Dec. 31, 2006)
Unit: CNY’000
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Turnover |
456,590 |
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Cost of goods sold |
438,370 |
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Sales expense |
15,830 |
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Management expense |
830 |
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Finance expense |
2,370 |
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Profit before tax |
220 |
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Less: profit tax |
150 |
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Profits |
70 |
Important Ratios (as of Dec. 31, 2006)
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*Current ratio 1.01
*Quick ratio 0.74
*Liabilities to assets 0.98
*Net profit margin (%) 0.02
*Return on total assets (%) 0.02
*Inventory /Turnover ×365 97days
*Accounts receivable/Turnover ×365 /
*Turnover/Total assets 1.00
* Cost of goods sold/Turnover 0.96
PROFITABILITY: AVERAGE
The turnover of SC appears fairly good in its line.
SC’s net profit margin is average.
SC’s return on total assets is average.
SC’s cost of goods sold is fairly high, comparing with its
turnover.
LIQUIDITY: AVERAGE
The current ratio of SC is maintained in a normal level.
SC’s quick ratio is maintained in a fair level.
The inventory of SC appears fairly large.
SC has no accounts receivable in 2006.
The short-term loan of SC is maintained in an average
level.
SC’s turnover is in an average level, comparing with the
size of its total assets.
LEVERAGE: FAIR
The debt ratio of SC is high.
The risk for SC to go bankrupt is average.
Overall financial condition of
the SC: Fairly stable.
SC is considered medium-sized in its line with fairly stable financial
conditions. A credit line up to USD 80,000
would appear to be within SC’s capacities.
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Unfavourable & favourable factors carry similar weight in credit
consideration. Capability to overcome financial difficulties seems
comparatively below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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NR |
In view of the lack of information, we have no basis upon which to
recommend credit dealings |
No Rating |
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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%)