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Report Date : |
23.11.2012 |
IDENTIFICATION DETAILS
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Name : |
MCS HOLDING LLC |
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Formerly Known As : |
M Si Es Holding XXK / Mongolian Consulting Holding Co Ltd |
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Registered Office : |
Central Tower, 15th Floor, Seoul Street 4, 2 Sukhbaatar
Square, Sukhbataar District, SBD-8, Ulaanbaatar 210620a |
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Country : |
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Financials (as on) : |
31.12.2011 |
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Date of Incorporation : |
1993 |
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Legal Form : |
Limited Liability Company |
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Line of Business : |
Subject is engaged as energy and infrastructure, information and
communication technology, beverage manufacturing and distribution, wholesale and
retail, property development, construction and printing. |
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No. of Employees : |
8000 (Group) |
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RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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Payment Behaviour : |
No Complaints |
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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 – June 30th, 2012
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Country Name |
Previous Rating (31.03.2011) |
Current Rating (30.06.2012) |
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Mongolia |
C1 |
C1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
Mongolia - ECONOMIC OVERVIEW
Economic activity in Mongolia was traditionally based on herding and agriculture - Mongolia's extensive mineral deposits, however, have attracted foreign investors, and the country is undergoing an economic transformation through its mining boom. Mongolia holds copper, gold, coal, molybdenum, fluorspar, uranium, tin, and tungsten deposits, among others, which account for a large part of foreign direct investment and government revenues. Soviet assistance, at its height one-third of GDP, disappeared almost overnight in 1990 and 1991 at the time of the dismantlement of the USSR. The following decade saw Mongolia endure both deep recession, because of political inaction and natural disasters, as well as economic growth, because of reform-embracing, free-market economics and extensive privatization of the formerly state-run economy. The country opened a fledgling stock exchange in 1991. Mongolia joined the World Trade Organization in 1997 and seeks to expand its participation in regional economic and trade regimes. Growth averaged nearly 9% per year in 2004-08 largely because of high copper prices and new gold production. By late 2008, the country was faced with external shocks from the global financial crisis, and a sharp drop in commodity prices slashed government revenues. GDP dropped 1.3% in 2009. In early 2009, the International Monetary Fund reached a $236 million Stand-by Arrangement with Mongolia and the country has largely emerged from the crisis. The banking sector is recovering and the government has started to enact greater supervision regulations. In October 2009, Mongolia passed long-awaited legislation on an investment agreement to develop the Oyu Tolgoi mine, considered to be among the world's largest untapped copper deposits. Another similarly lengthy process is underway for an investment agreement for the massive coal mine at Tavan Tolgoi; it is under review by the National Security Council and a final decision is expected in 2012. The economy grew 6.4% in 2010 and 17.3% in 2011, largely on the strength of commodity exports to nearby countries. Trade with China represents more than half of Mongolia's total external trade - China receives more than 90% of Mongolia's exports. Mongolia purchases 95% of its petroleum products and a substantial amount of electric power from Russia, leaving it vulnerable to price increases. In the face of anticipated growth in mining revenues, the country is grappling with the challenge of avoiding an overheated economy. Due to severe winter weather in 2009-10, Mongolia lost 22% of its total livestock, and meat prices doubled. Renewed concerns are surfacing over controlling inflation, which was more than 10% for much of 2010-11, due in part to soaring food prices. Government spending - on line to increase as much as 75% over 2011 - has added to concerns over inflation. Remittances from Mongolians working abroad, particularly in South Korea, are significant. Money-laundering is a growing concern.
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Source : CIA |
MCS HOLDING LLC
Building : Central
Tower, 15th Floor
Street : Seoul Street 4
Area : 2 Sukhbaatar Square, Sukhbataar District,
SBD-8
Town : Ulaanbaatar 210620a
Country : Mongolia
Telephone : (976 11) 312 625 ext. 1546 (Ms. Tuksjargal)
/ 311 079 / (976 77) 212 625 / Mobile (976 99) 118 123 / (976 88) 800 666 (N.
Arunbol)
Fax : (976 11) 312 175
E-Mail : azzaya.s@mcs.mn / n.zolo@mcs.mn / ganhuyat@mcs.net /
gantumur.l@mcs.net
Trading Styles : MCS Group
Also Known As : M Si Es Holding XXK / Mongolian Consulting Holding Co
Ltd
Name Position
1. Odjargal Jambaljamtsiin Chairman
/ Chief Executive Officer
2. Od Jambaljamtsiin Vice
Chairman / President of MCS Group
3. Enkhtuvshin Dachtseren Vice
President / Strategy Director
4. Gahtumur Lingov Vice
President / Human Resources Director
5. Gankhuyag Adilbish Vice
President Finance
6. D. Enkhtsetseg Vice
President
7. G. Enkhtuvshin Vice
President
8. Ms. Tuksjargal Legal
Advisor
9. N. Arunbol Accountant
10. S. Azzaya Office Manager
Total Employees : 150 (subject)
8,000 (group)
No complaints have been heard regarding payments from local suppliers or
banks.
Subject is a flagship of the MCS Group of Companies - one of the largest
private sector entities in terms of number of employees in Mongolia with about
8,000 full-time direct staff through its contractors and subcontractors. The
Group has more than 32 subsidiaries covering diversified business activities
including: energy & infrastructure, general manufacturing & services,
information & communications, property development, and - food, beverage
& alcohol. The Group had annual sales turnover of $US 250 million in 2008.
We consider it is acceptable to deal with subject for LARGE amounts,
although it is normal accepted practice for international suppliers to deal on
secured terms with Mongolian importers.
Trade risk assessment :
Normal
MONGOLIAN MCS HOLDING TO ACQUIRE MINING OPERATIONS.
According to press release dated of 21 July 2008 Kerry Holdings Ltd and
MCS Holding LLC plan to acquire QGX Ltd, a miner operations in Mongolia, in an
offer valued at $259 million.
Shareholders of QGX representing approximately 42 per cent of the firm
have agreed to tender to the $5-per-share cash offer. The board of directors of
QGX has also unanimously recommended the deal, which includes a $9.1 million
break fee and is expected to close in September.
QGX's two most advanced properties are the Baruun Naran and the Golden
Hills projects in Mongolia. Barrick Gold Corp. (TSX:ABX) holds a nine per cent
stake in the company, which is based in Waterdown, Ont.
Shares in QGX, which had been halted pending news, rose 38 cents or more
than eight per cent on the TSX to $4.88, with 2.5 million changing hands.
NAME : TRADE AND DEVELOPMENT BANK OF MONGOLIA
Branch : Juulnchny Gudamj 7
Town : Ulaanbaatar 210646
Telephone : (976 11) 312
362 / 331 133
Fax : (976 11) 325 449
Group members have accounts with the following banks :
1. Golomt Bank of Mongolia
Main Branch
Bodi Tower, Sukhbaatar Square
Ulaanbaatar
Telephone: (976 11) 311 530
Fax : (976 11) 312 307
2. Khan Bank of Mongolia
Peace Avenue
P.O Box-185
Ulaanbaatar
Telephone: (976 11) 457 880
Fax : (976 11) 457 880
3. Khas Bank
Sukhbaatar district
Ulaanbaatar 14200
Telephone: (976 11) 318 185
Fax : (976 11) 328 701
Private companies in Mongolia are not required to publish or
disclose balance sheets. However, the subject interviewed offered
the following information which applies to the MCS Group (latest
available):
Sales Turnover : US DLRS 40,000,000 - 2002 - exact
: US DLRS 50,000,000 - 2003 - exact
: US DLRS 80,000,000 - 2004 - exact
: US DLRS 100,000,000 - 2005 -
exact
: US DLRS 150,000,000 - 2006 -
exact
: US DLRS 200,000,000 - 2007 -
exact
: US DLRS 250,000,000 - 2008 -
exact
Net Profit : not given but stated to be 10%.
Financial year ends 31 December.
Audited Balance Sheets as at 31 December 2011 showed applies to MCS Coca
Cola LLC:
2010 2011
(in thousands of TUGRIK)
ASSETS
Current
assets
Cash
and cash equivalents 919,656,137 2,938,389,723
Accounts
receivables 1,567,091,627 3,871,266,883
Trade
receivables (intercompany)
1,025,413,337 2,746,607,292
Trade
receivables
394,698,490 831,673,358
Amount
due from employee
7,331,950 32,857,620
Amount
due from debtors
25,186,655 129,593,607
AR
- returnable packaging deposit value
100,678,847 104,948,097
AR
- returnable packaging deposit
value
(intercompany)
18,334,580 30,139,140
Dividend
receivables
- -
Current
financial assets
- -
Current
financial assets (intercompany)
- -
Current
finance lease receivables
- -
Current
finance lease receivables (intercompany)
- -
Allowance
for doubtful debts
(4,552,231) (4,552,231)
Tax
recoverable 561,670,652 486,375,238
Amount
due from Intercompany 10,000 34,312,675
Inventory
10,608,411,085 14,164,513,180
Supply
material 1,301,844,040 1,303,675,458
Prepayments 211,889,245 456,285,682
Advances 1,831,576 10,273,520
Assets
held for sale - -
Total
current assets
15,172,404,361 23,265,092,359
Non-current
assets
Tangible
assets 37,794,786,253 37,456,076,692
Intangible
assets 2,375,576 1,195,274
Investments - -
Other
non-current assets 269,286,566 881,636,873
Total
non-current assets
38,066,448,395 38,338,908,839
TOTAL
ASSETS 53,238,852,756 61,604,001,197
EQUITY
AND LIABILITIES
Liabilities
Current
liabilities 7,796,632,332 9,727,227,434
Taxes
payables 1,321,746 218,858,309
Amount
due to Intercompany 1,128,136,151 4,225,200,714
Dividends
payable - -
Unearned
revenue 2,313,960 3,078,620
Non-current
interest free payables - 43,560,000
Loans
and borrowings 23,290,285,305 21,329,246,546
Term
loans (intercompany)
- -
TOTAL
LIABILITIES 32,218,689,494 35,547,171,623
EQUITY
Total
equity
21,020,163,263 26,056,829,575
TOTAL
EQUITY AND LIABILITIES
53,238,852,756 61,604,001,197
INCOME
STATEMENT
Net
sales 46,530,476,087 72,180,010,562
Cost
of sales - variable 33,667,646,438 50,200,881,319
Gross
margin 12,862,829,649 21,979,129,243
Operational
expenses 8,300,124,105 11,638,731,739
Marketing
expenses 756,314,240 1,384,362,779
Distribution
expenses 3,097,107,082 5,149,268,882
General
administration 386,363,446 361,950,636
Finance
department 184,918,477 197,665,058
Legal
department - -
HR
department 42,463,509 43,634,074
Project - -
Marketing
department 97,100,108 155,337,376
Legal
& admin department 91,386,198 118,897,064
Other
departments - 94,283,686
Internal
service units - -
Internal
audit - -
Research
department - -
IT - -
PR - -
Other
expenses 3,644,471,045 4,133,332,184
Operating
profit/(loss) 4,562,705,544 10,340,397,504
Other
gains and (losses) 4,132,103,324 (2,764,539,545)
Other
income 1,942,401,367 923,570,802
Other
expense 55,535,350 110,780,683
Earnings
before interest and tax
10,581,674,885 8,388,648,078
Finance
cost 2,656,843,523 2,200,790,023
Earnings
before tax 7,924,831,362 6,187,858,054
Income
Tax 1,089,719,146 1,151,191,742
Net
profit /(loss) 6,835,112,216 5,036,666,312
Financial year ends 31 December.
Date Started :
1993
Tax No. :
2628236
Authorised Capital : US
DLRS 30,000,000
Paid up Capital : US DLRS
30,000,000
Limited Liability Company with the following shareholders :
Percentage
1.
Odjargal Jambaljamtsiin )
(Mongolian national) )
) 73.9%
2.
Od Jambaljamtsiin )
(brother of the above) )
3.
Senior management of the subject.
26.1%
MCS Holding LLC, founded in 1993 as the first Mongolian private
consulting company in the energy sector, the MCS Group has successfully
expanded its business operations in such diversified fields, as energy and
infrastructure, information and communication technology, beverage
manufacturing and distribution, wholesale and retail, property development,
construction and printing. The MCS Group has 8,000 employees and has been
ranked as one of the top five taxpayers for the last consecutive years.
Personal Profile on Odjargal Jambaljamtsiin :
Odjargal Jambaljamtsiin graduated from the Polytechnic Institute, Kiev,
in 1989, Mr. Odjargal worked as an engineer at the Energy Bureau in Mongolia
for a few years before setting up his own engineering company in 1993. He has a
MBA from Maastricht School of Management.
Od Jambaljamtsiin :
Mr. Od, the older brother of Mr. Odjargal, graduated from Moscow
University of Foreign Relations with a bachelor’s degree and from Oxford School
of Foreign Service with a master’s degree and had served as a diplomat for many
years before joining the company.
Affiliated
companies of MCS Holding LLC :
Subsidiaries &
Associates
1. Enerko LLC
MCS Anun Center
Chinggis Avenue
Khan-Uul District, 3rd Khoroo
Ulaanbaatar 210136
Telephone: (976 11) 346 464
Fax : (976 11) 346 262
2. Erchim Suljee LLC
MCS Anun Center
Chinggis Avenue
Khan-Uul District, 3rd Khoroo
Ulaanbaatar 210136
Telephone: (976 11) 346 464
Fax : (976 11) 346 262
3. MCS Electronics Co Ltd
Central Tower 14/F
Sukhbaatar Square No. 2
Sukhbaatar District,
SBD-8
Ulaanbaatar-210620A
Telephone: (976 11) 323 705 /
Mobile (976 88) 113 263
Fax : (976 11) 312 699
4. Spirt Bal Buram JSC
Mandal sum
Selenge aimag
Telephone: (976 11) 311 079
Fax : (976 11) 312 175
E-mail : eldevoch@mcs.mn
5. Interpress Co Ltd
MCS Plaza, 1st Floor
Seoul Street 4
Ulaanbaatar 210644
Telephone: (976 11) 326 898 /
Mobile (976 99) 118 668
Fax : (976 11) 329 474
E-mail : interpress@magicnet.mn
6. MCS Property LLC
MCS Palaza
Seoul Street 4
Ulaabaatar 210644
Telephone: (976 11) 311 079 /
312 625
Fax : (976 11) 312 175
7. Anungoo Co Ltd (Procter &
Gamble)
MCS Plaza, 2nd Floor
Seoul Street 4
Ulaanbaatar 210644
Telephone: (976 11) 961 619
Fax : (976 11) 312 175
E-mail : anungoo@mcs.mn
8. MCS International LLC
MCS Anun Center
Chinggis Avenue
Khan-Uul District, 3rd Khoroo
Ulaanbaatar 210136
Telephone: (976 77) 226 363 /
226 6264
Fax : (976 77) 226 030
Est.: 1 April 1996
C.R. No. : 9011035035
Tax No.: 2090007
Capital : TUGRIK 700,000,000
Sole shareholder : MCS Holding
LLC
9. Chinggiz Eco Tour Co Ltd
MCS Plaza, 5th Floor
Seoul Street 4
Ulaanbaatar 210644
Telephone: (976 99) 115 153
Fax : (976 11) 312175
10. Devshil-Trade Co Ltd
Sonsgolon
Bayangol District
Ulaanbaatar
Telephone: (976 11) 632 964 /
631 539
Fax : (976 11) 631 709
E-mail : deb_enkh@mcs.mn
11. MCS Gyals Medical Centre
1st Floor
Russian Hospital
Jukov Ave.131
Bayanzurkh district
Ulaanbaatar
Telephone: (976 99) 112 603 /
(11) 457 781
Fax : (976 11) 451 807
E-mail : mcsInter@mcs.mn
12. Zuunkharaa Trade Co Ltd
MCS Coca-Cola Plaza
Chingis Avenue
Khan Uul district
Ulaanbaatar-19
Telephone: (976 11) 345 234
Fax : (976 11) 345 228
13. Unitel LLC
Central Tower, 8th Floor
Sukhbatar Square 2
Sukhbatar District 8
Ulaanbaatar 210620A
Mongolia
Telephone: (976 11) 331 730
Fax :
(976 11) 330 708
E-Mail :
bayarbakhdal@unitel.mn
Est.: 5 October 2005
C.R. No.: 482106
14. MCS Coca Cola LLC
MCSCC Plant
Peace Avenue, Gachuurt Road
104
Amgalan 13260, Bayanzurkh
District, 10th Khoroo
Ulaanbaatar
Telephone: (976 70) 165 555
Fax : (976 70) 165 500
Est.: 26 July 2001
C.R. No. : 9011080120
Tax No.: 2663503
Capital : TUGRIK 5,000,000,000
Sole shareholder : MCS Holding
LLC
15. Mon Sat Co Ltd
MCS Plaza, 3rd Floor
Seoul Street 4
Ulaanbaatar 210644
Telephone: (976 11) 312 625
Fax : (976 11) 312 175
16. Orbitnet Co LLC
Central Tower 14/F
Sukhbaatar Square No. 2
Sukhbaatar District,
SBD-8
Ulaanbaatar-210620A
Telephone: (976 11) 323 705
Fax : (976 11) 312 699
17. Officenet LLC
MCS Plaza, 3rd Floor
Seoul Street 4
Ulaanbaatar 210644
Telephone: (976 11) 344 931
Fax : (976 11) 312 175
18. Goyo Co Ltd
MCS Plaza, 3rd Floor
Seoul Street 4
Ulaanbaatar 210644
Telephone: (976 11) 342 531
Fax : (976 11) 344 015
19. Shangrila Hotel
Ulaanbaatar
Telephone: (976 11) 326 602
Fax : (976 11) 326 643
20. Orchlon School
Ulaanbaatar
Telephone: (976 11) 353 519
Fax : (976 11) 354 115
21. Orchlon Club
Ulaanbaatar
Telephone: (976 11) 354 327
Fax :
(976 11) 354 326
22. MCS Distribution LLC
Ulaanbaatar
Telephone: (976 11) 345 234
Fax : (976 11) 345 460
23. Energy Resources LLC
Central Tower
2 Sukhbaatar square, SBD-8
15th floor
Ulaanbaatar 210620A
Telephone: (976 70) 122 279 /
132 279
Fax : (976 11) 322 279
24. Global Energy
Ulaanbaatar
Telephone: (976 11) 311 079
Fax : (976 11) 312 175
25. Medimpex
Ulaanbaatar
Telephone: (976 11) 310 429
Fax : (976 11) 318 254
26. Irish Pub Grand Khaan
Ulaanbaatar
Telephone: (976 11) 336 666
Fax : (976 11) 330 995
27. MCS - APB LCL
Ulaanbaatar
Telephone: (976 11) 464 304
Fax : (976 11) 464 306
28. Sky Resort
Ulaanbaatar
Telephone: (976 11) 311 079
Fax : (976 11) 311 079
29. MCS Estates
Ulaanbaatar
Telephone: (976 11) 311 079
Fax : (976 11) 312 175
30. Green Catering LLC
14th Floor, Central Tower
Ulaanbaatar
Mongolia
Telephone: (976 11) 314 411
Fax : (976 11) 314 411
Est.: 2008
31. MCSCom LLC
Central Tower 14/F
Sukhbaatar Square No. 2
Sukhbaatar District,
SBD-8
Ulaanbaatar-210620A
Telephone: (976 11) 323 705
Fax : (976 11) 312 699
32. MCS Anun LLC
1st floor, Building M-100
Chingeltei District
Ulaanbaatar
Telephone: (976 11) 312 908 /
312 938
Fax : (976 11) 312 907
33. Glamour LLC
Ulaanbaatar
34. MCS Health LLC
35. SBB Trade LC
36. MCS Armor LLC
37. Uniservice Solution LLC
38. MCS Metals LLC
39. MCS Tour Co Ltd
MCS Plaza, 5th Floor
Seoul St 4
Ulaanbaatar 210644
Telephone: (976 99) 115 153
Fax : (976 11) 312175
E-mail : MCSTour@mcs.mn
(dormant)
The Company is involved in the following activities :
Holding and management company for a group of companies.
Subject involves only in key decision making for each subsidiary such as
major capital expenditure or partnership selection and provides various
group-level services including finance, human resource, legal, insurance,
global marketing & media communications to its subsidiaries, while each
subsidiary’s day-to-day operation is managed
by a management team experienced in its own business independently from
the MCS Holding’s management.
Subject's subsidiaries operating in 6 different business sectors
includes:
- Mining and mineral exploration
- Property development and management
- Engineering and infrastructure development
- Information and communication technology
- Consumer goods production and distribution
- Services
NACE Code : 6420
Subject's subsidiaries import worldwide.
The Company has the following facilities :
Administrative offices located at the heading address as well as a
representative office located in Beijing, China (see Branch Offices
below).
Until 2009 subject was located at :
MCS Plaza
Seoul Street 4
Sukhbataar District
Ulaanbaatar 210644
Representative Office
Beijing Sun Joe Mansion
6 Ritan Rd, Jiang Gou Avenue
Beijing
China
Telephone : (86 10) 6595
8009
Fax : (86 10) 6506 6311
Interviewed: S. Azzaya (Office Manager).
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.55.16 |
|
|
1 |
Rs.88.03 |
|
Euro |
1 |
Rs.70.86 |
INFORMATION DETAILS
|
Report
Prepared by : |
SDA |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.