MIRA INFORM REPORT

 

 

Report Date :           

21.05.2012

 

IDENTIFICATION DETAILS

 

Name :

MARUBENI-ITOCHU STEEL INC

 

 

Registered Office :

 Nihombashi 1-Chome Bldg, 1-4-1 Nihombashi Chuoku Tokyo 103-8247

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2011

 

 

Date of Incorporation :

October 2001

 

 

Com. Reg. No.:

(Tokyo-Chuoku) 075892

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Trading house specializing in iron & steel materials & products

 

 

No. of Employees :

811

 

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

 

Status :

Satisfactory

Payment Behaviour :

Regular

Litigation :

---

 

 

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)

Japan

a1

a1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

Company name

 

MARUBENI-ITOCHU STEEL INC

 

 

REGD NAME 

 

Itochu Marubeni Tekko KK

 

 

MAIN OFFICE

 

Nihombashi 1-Chome Bldg, 1-4-1 Nihombashi Chuoku Tokyo 103-8247 JAPAN

Tel: 03-5204-3300     Fax: 03-5204-3810

 

URL:                 http://www.benichu.com/

E-Mail address:            Not specified (thru the URL to each Division)

 

 

ACTIVITIES

 

Trading house specializing in iron & steel materials & products

 

 

BRANCHES

 

Osaka, Nagoya, Sapporo, Hiroshima, Fukuoka, other (Total 14)

 

 

OVERSEAS

 

China (5), India (3), Australia, USA (9), Canada (2), Europe/CIS, other (27)

 

 

SUBSIDIARIES

 

(Domestic) 58; (Overseas) 79

 

OFFICER(S)

 

KENICHIRO USHINO, PRES                  Tsunekatsu Yonezawa, ch

Yasuhiko Koike, mgn dir                         Yasuo Matsuura, mgn dir

Shigeru Numata, mgn dir                        Takeshi Mitomi, mgn dir

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 1,611,356 M

PAYMENTS  REGULAR             CAPITAL           Yen 30,000 M

TREND SLOW                          WORTH            Yen 167,679 M

STARTED         2001                             EMPLOYES      811

 

 

COMMENT

 

TRADING HOUSE SPECIALIZING IN STEEL & IRON PRODUCTS, JOINTLY OWNED BY MARUBENI CORP & ITOCHU CORP. 

 

FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

 

                        Forecast (or estimated) for the 31/03/2012 fiscal term.

 

 

HIGHLIGHTS

 

The subject company was created on the basis of spin-offs and integration of two steel products divisions at Marubeni Corp and Itochu Corp to form a separate entity.  This is a trading house inheriting successful & traditional business rights of each firm in the line of steel & iron raw materials & products markets.  The firm has four core divisions: Iron & Steel Div (1), Iron & Steel Div (2), Iron & Steel Div (3), and Tubular Products Div (for handling items see OPERATION).  Osaka branch office handles these products in lumpsum.  Top-ranked in the specific business items.  The firm will expand the plant at MI Steel Processing Guangzhou Co Ltd, Guangzhou City, China, specializing in the processing of automobile-use steel sheets in South China.  The firm received orders for approx 52,000 tons of oil country tubular goods (OCTG) from Kuwait Oil Company (KOC) jointly with China’s Pangang Group Chengdu Steel & Vanadium Co Ltd.   Most of this will be heat-treated steel pipes for casing, and plans are to ship them to Kuwait from July thru November 2011.  Clients include major car makers, heavy machinery mfrs, electric appliances mfrs, nationwide. 

 

           

FINANCIAL INFORMATION

 

The sales volume for Mar/2011 fiscal term amounted to Yen 1,611,356 million, a 15% up from Yen 1,400,727 million in the previous term.  This is attributed to steep expansion of demand particularly in China and other emerging nations.  Export trade targeting Asia moved into firm territory, with business activity picking up particularly from automobile industries.  Japan’s nationwide crude steel production in Fiscal 2010 increased 14.8% from Fiscal 2009’ level and the first such year-on-year increase recorded in three years.  The recurring profit was posted at Yen 28,015 million and the net profit at Yen 13,502 million, respectively, compared with Yen 6,849 million recurring profit and Yen 537 million net profit, respectively a year ago. 

 

(Apr/Sept/2011 results): Sales Yen 840,800 million (up 8.6%), recurring Yen 18,000 million (up 30.3%), net profits Yen 13,000 million (up 103.1%).  (% compared with the corresponding period a year ago).  The first half of fiscal 2011 was characterized by the slowed pace of business recovery in US & Europe.  In Asia, by contrast, China, India, and other nations with large-scale of domestic demand continue to post high economic growth, and other Asian economies generally moved in recovery models, although the sense was that the speed of these comebacks slowed to some degree.  In Japan, although economic conditions during the first half remained in severe straits because of the impact of the Great East Japan Earthquake, steady signs of recovery emerged on the strength of the restoration of the supply chain.  Japan’s nationwide crude steel production during the first half of fiscal 2011 was tracked a 53.31 million tons, a decrease of 3.8% from the total for the first half of fiscal 2010.

 

For the current term ending Mar 2012 the recurring profit is projected at Yen 28,500 million and the net profit at 14,000 million, on a 5% rise in turnover, to Yen 1,690,000 million.  The said business acquisition from Kuwait Oil Co will contribute.  Production in China will expand. 

 

The financial situation is considered FAIR and good for ORDINARY business engagements. 

 

 

REGISTRATION

 

Date Registered: Oct 2001

Regd No.:       (Tokyo-Chuoku) 075892

Legal Status:   Limited Company (Kabushiki Kaisha)

Authorized:      2,400 shares

Issued:             600 shares

Sum:                 Yen 30,000 million

 

Major shareholders (%): Marubeni Corp* (50), Itochu Corp** (50)

No. of shareholders: 2

 

*.. One of big 5 general trading houses, Tokyo, founded 1949, listed Tokyo, Osaka, Nagoya, Frankfurt, Düsseldorf S/E’s, capital Yen 262,686 million, turnover Yen 9,020,468 million, operating profit Yen 145,774 million, recurring profit Yen 207,217 million, net profit Yen 136,541 million, total assets Yen 4,679,089 million, net worth Yen 773,592 million, employees 30,626, pres Teruo Asada.

 

**.. Equally one of big 5 general trading houses, Osaka, founded 1949, listed Tokyo, Osaka, Nagoya S/E’s, capital Yen 202,241 million, turnover Yen 11,392,589 million, operating profit Yen 256,082 million, recurring profit Yen 182,097 million, net profit Yen 160,975 million, total assets Yen 5,673,568 million, net worth Yen 1,154,876 million, employees 62,635, pres Masahiro Okafuji.

 

Nothing detrimental is known as to the commercial morality of executives.

 

 

OPERATION

 

Activities: A trading firm jointly owned by Marubeni Corp & Itochu Corp, specializing in iron & steel products & related, IT-related business, including development of supply chain management (SCM) system of steel products, having the following 4 core divisions (--100%):

 

Iron & Steel Div (1): handles a full range of steel products for automakers and auto parts makers, including carbon steel, specialty steel, stainless steel, electrical steel sheets, magnequench powder, etc;

 

Iron & Steel Div (2): handles steel sheet products for domestic users in the appliance, furniture, container and office automation equipment, etc, including foreign business of slabs, billets, blooms & other semi-finished products, bars, shapes, plates, hot rolled and cold rolled steel, coated steel sheets, tin mill products, clad steel plates, copper alloy tubes;

 

Iron & Steel Div (3); handles plates & shapes, specialty steel, wire products & stainless steel.  The division newly started Noble Metals Dept to handle noble items, such as Titanium, Cupro-Nickel tubes,, offering package of noble metals required for construction of Desalination Plants;

 

Tubular Products Div: handles various types of tubular products and equipment & materials for plant projects.  Also exports pipes for oil fields and major pipeline projects overseas. (Detailed breakdown of each Division is not available.)

 

Exports (60%).

 

Clients: [Automakers, steel mfrs, wholesalers] Mazda Motor Corp, Fuji Heavy Ind, Nissan Motors, Isuzu Motor, NTN, Matsushita Electric Ind, Kawasaki Heavy Ind, Hitachi Ltd, Exxon Mobil, other

Exports to Hyundai (Korea), Thai Controlled Steel Sheet, BNG Steel, other.

            No. of accounts: 2,000

            Domestic areas of activities: Nationwide

 

Suppliers: [Steel mfrs, wholesalers] Nippon Steel, JFE Steel, Nisshin Steel, Kobe Steel, Sanyo Special Steel, Sumitomo Metal Ind, Nippon Steel & Sumikin Stainless Steel Corp, other.

 

Payment record: Regular

 

Location: Business area in Tokyo.  Office premises at the caption address are leased and maintained satisfactorily.

 

Bank References:

·         Mizuho Corporate Bank (H/O)

·         SMBC (H/O)

Relations: Satisfactory

 

 

FINANCES

 

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2011

31/03/2010

INCOME STATEMENT

 

 

 

  Annual Sales

　

1,611,356

1,400,727

 

  Cost of Sales

1,527,399

1,333,660

 

      GROSS PROFIT

83,957

67,067

 

  Selling & Adm Costs

57,070

57,807

 

      OPERATING PROFIT

26,887

9,260

 

  Non-Operating P/L

1,128

-2,411

 

      RECURRING PROFIT

28,015

6,849

　

      NET PROFIT

13,502

537

BALANCE SHEET

 

 

 

 

  Cash

　

24,892

25,968

 

  Receivables

 

373,376

314,437

 

  Inventory

 

140,688

122,063

 

  Securities, Marketable

　

　

 

  Other Current Assets

31,965

32,867

 

      TOTAL CURRENT ASSETS

570,921

495,335

 

  Property & Equipment

52,499

54,081

 

  Intangibles

 

7,247

8,724

 

  Investments, Other Fixed Assets

75,152

72,019

 

      TOTAL ASSETS

705,819

630,159

 

  Payables

 

226,045

195,195

 

  Short-Term Bank Loans

183,440

129,695

 

　

 

　

　

 

  Other Current Liabs

27,952

23,888

 

      TOTAL CURRENT LIABS

437,437

348,778

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

90,490

108,163

 

  Reserve for Retirement Allw

　

　

 

  Other Debts

　

10,213

12,663

 

      TOTAL LIABILITIES

538,140

469,604

 

      MINORITY INTERESTS

 

 

 

Common stock

30,000

30,000

 

Additional paid-in capital

20,537

22,370

 

Retained earnings

119,662

110,154

 

Evaluation p/l on investments/securities

(12,529)

(6,811)

 

Others

 

10,009

4,843

 

Treasury stock, at cost

　

　

 

      TOTAL S/HOLDERS` EQUITY

167,679

160,556

　

      TOTAL EQUITIES

705,819

630,159

ANALYTICAL RATIOS            Terms ending:

31/03/2011

31/03/2010

 

 

Net Worth (S/Holders' Equity)

167,679

160,556

 

 

Current Ratio (%)

130.52

142.02

 

 

Net Worth Ratio (%)

23.76

25.48

 

 

Recurring Profit Ratio (%)

1.74

0.49

 

 

Net Profit Ratio (%)

0.84

0.04

 

 

Return On Equity (%)

8.05

0.33

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.54.87

UK Pound

1

Rs.86.46

Euro

1

Rs.69.49

 

 

INFORMATION DETAILS

 

Report Prepared by :

PRL

 

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.