MIRA INFORM REPORT

 

 

Report Date :

01.11.2012

 

IDENTIFICATION DETAILS

 

Name :

SOJITZ CORPORATION

 

 

Registered Office :

6-1-20 Akasaka Minatoku Tokyo 107-8655

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2011

 

 

Date of Incorporation :

December 1982

 

 

Com. Reg. No.:

(Tokyo-Minatoku) 049977

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Import, export, wholesale of machinery, energy & metals, chemicals

 

 

No. of Employees :

16,615

 

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 :

No Complaints

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 – June 30th, 2012

 

Country Name

Previous Rating

(31.03.2012)

Current Rating

(30.06.2012)

Japan

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

JAPAN - ECONOMIC OVERVIEW

 

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A tiny agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. Usually self-sufficient in rice, Japan imports about 60% of its food on a caloric basis. Japan maintains one of the world's largest fishing fleets and accounts for nearly 15% of the global catch. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2011 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2011. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan further into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake in March disrupted manufacturing. Electricity supplies remain tight because Japan has temporarily shut down almost all of its nuclear power plants after the Fukushima Daiichi nuclear reactors were crippled by the earthquake and resulting tsunami. Estimates of the direct costs of the damage - rebuilding homes, factories, and infrastructure - range from $235 billion to $310 billion, and GDP declined almost 0.5% in 2011. Prime Minister Yoshihiko NODA has proposed opening the agricultural and services sectors to greater foreign competition and boosting exports through membership in the US-led Trans-Pacific Partnership trade talks and by pursuing free-trade agreements with the EU and others, but debate continues on restructuring the economy and reining in Japan's huge government debt, which exceeds 200% of GDP. Persistent deflation, reliance on exports to drive growth, and an aging and shrinking population are other major long-term challenges for the economy.

 

Source : CIA

Company name and address

 

SOJITZ CORPORATION

 

REGD NAME:    Sojitz KK

 

MAIN OFFICE:  6-1-20 Akasaka Minatoku Tokyo 107-8655 JAPAN

Tel: 03-5520-5000     Fax: 03-5520-2390

                       

URL:                 http://www.sojitz.com/

E-Mail address:            info@sojitz.com

 

 

ACTIVITIES

 

Import, export, wholesale of machinery, energy & metals, chemicals, other

 

BRANCHES

 

7 domestic, 91 overseas

(Subsidiaries/affiliates): 144 domestic, 377 overseas

 

 

CHIEF EXECS

 

YUTAKA KASE, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

SUMMARY    

 

FINANCES        FAIR                             A/SALES          Yen 4,014,639 M

PAYMENTSNO COMPLAINT      CAPITAL           Yen 160,339 M

TREND STEADY                       WORTH            Yen 355,510 M

STARTED         2003                             EMPLOYES      16,615

           

           

COMMENT

 

GENERAL TRADING HOUSE.  FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR CREDIT ENGAGEMENTS: US$125,000.00 / DA TERMS.

 

           

           

                               Forecast figures for the 31/03/2012 fiscal term.

 

 

HIGHLIGHTS

 

The subject company was established in Apr 2003 by forming a joint holding company, named Nissho Iwai-Nichimen Holdings Company, by the then Nissho Iwai Co and Nichimen Co, and subsequently in Apr 2004 the two merged into Sojitz Corp as captioned.  The holding company, at the same time, renamed Sojitz Holdings Corporation.  The merger was formed in order to restructure the two firms through supports from financial institutions including the then UFJ Bank (now MUFG), the main bank for the two firms.  On 01/Oct/2005, in order to further streamline the Group’s management framework, Sojitz Holdings merged with its principal operating arm and wholly owned subsidiary, Sojitz Corporation.  The company’s name was then changed to Sojitz Corporation.  This is a general trading house succeeding the business rights & operations of the said two firms, excluding liquidation or separation of unprofitable divisions & operations.  This is the sixth-ranked general trading house.  Major handling items are machinery, energy & resources, which former Nissho Iwai Corp was the stronger, and textiles, etc, which the former Nichimen Corp was stronger.  Highly competitive in fields of aircraft, lumber and urban development.  The company plans to acquire additional concession of the Minerva mine in Australia to independently operate the mine as the primary contractor.  It joined the potassium sulfate fertilizer production in India.

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2011 fiscal term amounted to Yen 4,014,639 million, a 4.4% up from Yen 3,844,418 million in the previous term.  The increases were mainly attributable to a recovery in commodity prices and demand for the products in an environment in which high economic growth in emerging countries, particularly those in Asia, are driving the global economy.  By Divisions, Machinery down 1.9% to Yen 965,412 million; Energy & Metals up 15.9% to Yen 1,013,981 million, due to increase in prices of ferroalloys and precious metals and growth in precious metal, ferroalloy & coat unit volumes; Chemicals & Functional Materials up 11.8% to Yen 612,510 million, mainly due to an increase in trading volumes reflecting demand recoveries in China and elsewhere in Asia & methanol price increases; Lifestyle up 1.0% to Yen 1,378,000 million, due to major improvement in fertilizer business’s earnings.  The recurring profit was posted at Yen 45,316 million and the net profit at Yen 15,981 million, respectively, compared with Yen 13,702 million recurring profit and Yen 8,794 million net profit, respectively, a year ago.

 

(Apr/Dec/2011 results): Sales Yen 3,300,577 million (up 11.5%), operating profit Yen 38,605 million (up 38.0%), recurring profit Yen 38,474 million (up 13.9), net losses Yen 13,458 million (previously Yen 14,775 million profits).  (% & figures compared with the corresponding period a year ago).  Sales growth were driven mainly by Energy & Metal Division (increased oil & coal production and prices), and Consumer Lifestyle Business Division (higher prices and unit sales of cigarettes and wheat).  Posted extraordinary losses of Yen 13,731 million from valuation loss on investment securities and Yen 2,637 million losses on liquidation of subsidiaries and affiliates.

 

For the current term ending Mar 2012 the recurring profit is projected at Yen 46,000 million and the net profit at Yen 16,000 million, respectively, on a 9.1% rise in turnover, to Yen 4,380,000 million.  Natural resources will expand with increased coal & copper concessions.  In automobiles, sales in Russia will pick up and automobile production in South America will be free of adverse effects of a walkout.  The forecast is based on: Yen 80/US Dollar exchange rate, and crude oil prices at US$90/bbl (Brent)

 

The financial situation is considered FAIR and good for ORDINARY business engagements. The proposed amount is considered well within the firm’s financial capacities.

 

 

REGISTRATION

 

Date Registered:  Dec 1982

Regd No.:         (Tokyo-Minatoku) 049977

Legal Status:      Limited Company (Kabushiki Kaisha)

Authorized:         1,349 million shares

Issued:                1,251,091,013 shares

Sum:                   Yen 160,339 million

 

Major shareholders (%): Japan Trustee Services T (6.2), Master Trust Bank of Japan T (3.3), State Street Bank & Trust 505225 (1.2), Mellon Bank Mellon Omnibus US P (1.2), Chase London SL Omnibus Acct (1.1), JUNIPER (0.9), Melon Bank NA Treaty Cl Omnibus (0.8), Japan Trustee Services T1 (0.7), Japan Trustee Services T3 (0.7); foreign owners (26.6)

 

No. of shareholders: 191,486

 

Listed on the S/Exchange (s) of: Tokyo, Osaka

 

Managements: Yutaka Kase, ch; Masayuki Yokokawa, v ch; Yoji Sato, pres; Shigelo Dantani, v pres; Koji Suzuki, v pres; Yoshio Mogi, s/mgn dir; Shin’ichi Taniguchi, s/mgn dir;

Tetsuya Koreta, mgn dir; Masahiro Komiyama, mgn dir; Tatsunobu Sako, mgn dir

 

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

 

 

OPERATION

 

Activities: A general trading house:

 

(Sales breakdown by Divisions):

 

Machinery Division (24%): Automotive Unit, Environment & Infrastructure Unit, IT Business Unit, Marine & Aerospace Unit;

 

Energy & Metals Division (25%): Energy & Nuclear Unit, Coal & Non-ferrous Metals Unit, Ferrous Metals & Steel Products Unit;

 

Chemicals & Functional Materials Division (15%): Chemicals Unit, Functional Materials Unit;

 

Lifestyle Business Division (34%): Foods Resources Unit, General Commodities & Textile Unit, Forest Products & Real Estate Development Unit;

 

Others (1%)

 

Overseas trading (30.7%): N America 2.7%, Europe 2.6%, Asia/Oceania 19.7%, other 5.7%.

           

Clients: [Mfrs, wholesalers] Kobe Steel, NM Life, First Retailing, Uto Kosan, Zao Severstal, Varig S.A., Auto-Isuzu PT Indofood Sukses Makmur TBK, MMC Automotriz SA, other

No. of accounts: 2,000

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Hitachi Zosen, Hitachi Ltd, Toyo Rubber, Yamazaki

Nabisco, Sun Building Materials Corp, Sumitomo Metal Mining, Fuji Electric Systems,

Sojitz Asia, other.

 

Payment record: No Complaints

 

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

 

Bank References:

MUFG (Tokyo)

Mizuho Corporate Bank (H/O)

Relations: Satisfactory

 

 

FINANCIALS

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2011

31/03/2010

INCOME STATEMENT

 

 

 

  Annual Sales

　

4,014,639

3,844,418

 

  Cost of Sales

3,821,914

3,666,215

 

      GROSS PROFIT

192,725

178,203

 

  Selling & Adm Costs

155,205

162,074

 

      OPERATING PROFIT

37,519

16,128

 

  Non-Operating P/L

7,797

-2,426

 

      RECURRING PROFIT

45,316

13,702

　

      NET PROFIT

15,981

8,974

BALANCE SHEET

 

 

 

 

  Cash

　

415,694

455,728

 

  Receivables

 

478,880

462,233

 

  Inventory

 

243,210

248,629

 

  Securities, Marketable

5,437

6,131

 

  Other Current Assets

123,408

112,556

 

      TOTAL CURRENT ASSETS

1,266,629

1,285,277

 

  Property & Equipment

215,774

222,665

 

  Intangibles

 

132,595

114,445

 

  Investments, Other Fixed Assets

501,962

538,531

 

      TOTAL ASSETS

2,116,960

2,160,918

 

  Payables

 

414,984

377,468

 

  Short-Term Bank Loans

247,656

256,652

 

　

 

　

　

 

  Other Current Liabs

227,904

207,413

 

      TOTAL CURRENT LIABS

890,544

841,533

 

  Debentures

 

82,719

123,647

 

  Long-Term Bank Loans

723,926

763,098

 

  Reserve for Retirement Allw

13,136

13,280

 

  Other Debts

　

51,124

41,956

 

      TOTAL LIABILITIES

1,761,449

1,783,514

 

      MINORITY INTERESTS

 

 

 

Common stock

160,339

160,339

 

Additional paid-in capital

152,160

152,160

 

Retained earnings

159,358

146,489

 

Evaluation p/l on investments/securities

12,310

14,845

 

Others

 

(128,487)

(96,260)

 

Treasury stock, at cost

(170)

(169)

 

      TOTAL S/HOLDERS` EQUITY

355,510

377,404

　

      TOTAL EQUITIES

2,116,960

2,160,918

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2011

31/03/2010

 

Cash Flows from Operating Activities

　

67,863

107,222

 

Cash Flows from Investment Activities

-19,903

28,439

 

Cash Flows from Financing Activities

-72,054

-102,597

　

Cash, Bank Deposits at the Term End

　

415,261

454,262

ANALYTICAL RATIOS            Terms ending:

31/03/2011

31/03/2010

 

 

Net Worth (S/Holders' Equity)

355,510

377,404

 

 

Current Ratio (%)

142.23

152.73

 

 

Net Worth Ratio (%)

16.79

17.46

 

 

Recurring Profit Ratio (%)

1.13

0.36

 

 

Net Profit Ratio (%)

0.40

0.23

 

 

Return On Equity (%)

4.50

2.38

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.54.12

UK Pound

1

Rs.87.08

Euro

1

Rs.70.15

 

INFORMATION DETAILS

 

Report Prepared by :

MNL

 

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.