MIRA INFORM REPORT

 

 

Report Date :           

14.10.2011

 

IDENTIFICATION DETAILS

 

Name :

VELAN VALVE (SUZHOU) CO., LTD.

 

 

Registered Office :

No. 6 Chaichang Road, Mudu Town, Wuzhong District, Suzhou, Jiangsu Province 215101 Pr

 

 

Country :

China

 

 

Financials (as on) :

31.12.2010

 

 

Date of Incorporation :

16.09.2006

 

 

Com. Reg. No.:

320500400029436

 

 

Legal Form :

Wholly Foreign-Owned Enterprise

 

 

Line of Business :

Manufacturing and Selling Valve

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Maximum Credit Limit :

USD 80,000

 

 

Status :

Moderate

 

 

Payment Behaviour :

No Complaints

 

 

Litigation :

Clear

 

 

NOTES :

Any query related to this report can be made on e-mail : infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – September 30th, 2011

 

Country Name

Previous Rating

                   (30.06.2011)                  

Current Rating

(30.09.2011)

China

a2

a2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

Company name & address  

 

velan valve (suzhou) co., ltd.

no. 6 chaichang road, mudu town, wuzhong district

suzhou, jiangsu province 215101 PR CHINA

TEL: 86 (0) 512-69213380/69213387

FAX: 86 (0) 512-69682339/69213389

 

 

EXECUTIVE SUMMARY

 

Date of Registration          : september 16, 2006

REGISTRATION NO.                  : 320500400029436

LEGAL FORM                           : Wholly foreign-owned enterprise

CHIEF EXECUTIVE               : tian bin (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL             : usd 5,000,000

staff                                      : 55

BUSINESS CATEGORY             : manufacturing

Revenue                                : CNY 13,970,000 (AS OF DEC. 31, 2010)

EQUITIES                                 : CNY 25,880,000 (AS OF DEC. 31, 2010)

WEBSITE                                 : N/A

E-MAIL                                     : N/A

PAYMENT                                : AVERAGE

Recommended Credit Limit : UP TO USD 80,000 (PERIODICAL REVIEW)

MARKET CONDITION                : fair

FINANCIAL CONDITION                         : FAIR

OPERATIONAL TREND              : ORDINARY

GENERAL REPUTATION                       : AVERAGE

EXCHANGE RATE                     : CNY 6.38 = USD 1

 

 

Adopted abbreviations

(As Follows)

 

SC - Subject Company (the company inquired by you)

N/A – Not available

CNY – China Yuan Ren Min Bi

 

 

OPERATIONAL TREND & GENERAL REPUTATION

 

This section aims at indicating the relative positions of SC in respect of its operational trend & general reputation

 

Operational Trend:-                                             General Reputation:-

Upward                                                             Excellent

Steady                                                              Good

Fairly Steady                                                     Fairly Good

Ordinary                                                            Average

Fair                                                                   Fair

Stagnant                                                           Detrimental

Downward                                                         Not known

Not known                                                         Not yet be determined

Not yet be determined

 

 

LEGAL STATUS & HISTORY

 

SC was established as a wholly foreign-owned enterprise of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 320500400029436 on September 16, 2006.

 

SC’s Organization Code Certificate No.: 78885358-5

SC’s registered capital: usd 5,000,000

 

SC’s paid-in capital: usd 5,000,000

 

No significant changes of SC have been noted in SAIC since its incorporation.

 

Current Co search indicates SC’s shareholders & chief executives are as follows:-

 

Name of Shareholder (s)

% of Shareholding

Velan China Holdings Inc. (Canada)

100

 

SC’s Chief Executives:-

 

Position

 

Legal Representative, Chairman, and General Manager

Tian Bin

 

 

 

 

RECENT DEVELOPMENT

 

No recent development was found during our checks at present.

 

 

SHAREHOLDER CHART & BACKGROUND

 

Name                                                                                                  % of Shareholding

 

Velan China Holdings Inc. (Canada)                                                                     100

 

Business Number (BN): 836015479RC0001

Incorporation Date: 14 June 2005

Registered Office Address: 7007 COTE DE LIESSE ROAD MONTREAL QC H4T 1G2 Canada

Directors

-----------

A.K. VELAN

THOMAS VELAN

JOHN BALL

ROBERT TIAN

 

 

MANAGEMENT

 

Tian Bin, Legal Representative, Chairman and General Manager

--------------------------------------------------------------------------------------------

Ø         Gender: M

Ø         Qualification: University

Ø         Working experience (s):

 

At present, working in SC as legal representative, chairman and general manager

 

 

***Note: The given contact person (Alex Lee) is working in SC at present.

 

 

BUSINESS OPERATION

 

SC’s registered business scope includes R&D, manufacturing proportional servo hydraulic control valve, low power pneumatic control valves, selling its owned products and providing related technical consultation service and after-sales service.

 

SC is mainly engaged in manufacturing and selling valve.

 

SC’s products mainly include: ball valve, globe valve, etc.

 

SC sources its materials 100% from domestic market. SC sells 100% of its products overseas market, mainly Canada.

 

The buying terms of SC include T/T and Credit of 30-60 days. The payment terms of SC include L/C and Credit of 30-60 days.

 

*Major Local competitors:

===================

·         SIP Stard Valve Co., Ltd.

·         Suzhou Neway Valve Co., Ltd.

·         Suzhou Furun Machinery Co., Ltd.

·         Suzhou Viza Valve Co., Ltd.

 

Staff & Office:

--------------------------

SC is known to have approx. 55 staff at present.

 

SC rents an area as its operating office and factory, but the detailed information is unknown.

 

 

RELATED COMPANY

 

SC is not known to have any subsidiary at present.

 

 

PAYMENT

 

Overall payment appraisal:

( ) Excellent      ( ) Good      (X) Average      ( ) Fair      ( ) Poor      ( ) Not yet be 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: SC did not provide any name of trade/service suppliers and we have no other sources to conduct the enquiry at present.

 

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.

 

 

BANKING

 

The bank information of SC is not filed in SAIC.

 

 

 

 

FINANCIALS

 

Balance Sheet

Unit: CNY’000

As of Dec. 31, 2009

As of Dec. 31, 2010

Cash

18,680

2,040

Accounts receivable

1,560

4,030

Advances to suppliers

0

0

Other receivable

10

40

Inventory

3,130

6,770

Non-current assets within one year

0

0

Other current assets

100

130

 

------------------

------------------

Current assets

23,480

13,010

Fixed assets

27,490

25,750

Construction in progress

0

0

Long-term prepaid expenses

0

0

Deferred income tax assets

0

0

Other non-current assets

100

0

 

------------------

------------------

Total assets

51,070

38,760

 

=============

=============

Short-term loans

19,050

5,400

Notes payable

0

0

Accounts payable

3,990

4,880

Wages payable

0

0

Advances from clients

0

0

Other payable

20

40

Other current liabilities

130

2,560

 

------------------

------------------

Current liabilities

23,190

12,880

Non-current liabilities

10

0

 

------------------

------------------

Total liabilities

23,200

12,880

Equities

27,870

25,880

 

------------------

------------------

Total liabilities & equities

51,070

38,760

 

=============

=============

 

Income Statement

Unit: CNY’000

As of Dec. 31, 2010

Revenue

13,970

Cost of sales

11,320

    Sales expense

400

    Management expense

4,060

    Finance expense

650

Profit before tax

-2,000

Less: profit tax

0

Profits

-2,000

 

 

Important Ratios

=============

 

As of Dec. 31, 2009

As of Dec. 31, 2010

*Current ratio

1.01

1.01

*Quick ratio

0.42

0.48

*Liabilities to assets

0.45

0.33

*Net profit margin (%)

--

-14.31

*Return on total assets (%)

--

-5.16

*Inventory / Revenue ×365

--

177 days

*Accounts receivable/ Revenue ×365

--

106 days

* Revenue/Total assets

--

0.36

* Cost of sales / Revenue

--

0.81

 

 

FINANCIAL COMMENTS

 

PROFITABILITY: FAIR

l         The revenue of SC appears fair in its line in 2010.

l         SC’s net profit margin is poor in 2010.

l         SC’s return on total assets is fair in 2010.

l         SC’s cost of goods sold is average, comparing with its revenue.

 

LIQUIDITY: FAIR

l         The current ratio of SC is maintained in a normal level in both years.

l         SC’s quick ratio is maintained in a fair level in both years.

l         The inventory of SC appears fairly large.

l         The accounts receivable of SC appears fairly large.

l         The short-term loans of SC appear fairly large.

l         SC’s revenue is in a fair level, comparing with the size of its total assets.

 

LEVERAGE: AVERAGE

l         The debt ratio of SC is average in both years.

l         The risk for SC to go bankrupt is average.

 

Overall financial condition of the SC: Fair.

 

 

CONCLUSIONS

 

SC is considered small-sized in its line with fair financial conditions. The fairly large amount of inventory, accounts receivable and short-term loans may be a threat to SC’s financial condition. A credit line at the above amount appears beyond SC’s capacities, while a credit line up to USD 80,000 is recommended upon a periodical review basis.

 

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.49.02

UK Pound

1

Rs.77.13

Euro

1

Rs.67.56

 

 

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

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

----

NB

New Business

----

 

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

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.