MIRA INFORM REPORT

 

 

Report Date :

20.10.2012

 

IDENTIFICATION DETAILS

 

Name :

WUHU HENGDA SHEETING METAL CO., LTD.

 

 

 

 

Registered Office :

Hengda Machinery Industrial Park, Wuhu County, Wuhu Anhui Province 241100 Pr

 

 

 

 

Country :

China

 

 

 

 

Financials (as on) :

31.12.2011

 

 

 

 

Date of Incorporation :

25.11.2004

 

 

 

 

Com. Reg. No.:

340221000008237

 

 

 

 

Legal Form :

Limited Liabilities Company

 

 

 

 

Line of Business :

Manufacturing and selling cold-rolled sheets, galvanized sheets, and color coated sheets.

 

 

 

 

No. of Employees :

190

 

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

Payment Behaviour :

Slow but Correct

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

 

Country Name

Previous Rating

(31.03.2011)

Current Rating

(30.06.2012)

China

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

CHINA - ECONOMIC OVERVIEW

 

Since the late 1970s China has moved from a closed, centrally planned system to a more market-oriented one that plays a major global role - in 2010 China became the world's largest exporter. Reforms began with the phasing out of collectivized agriculture, and expanded to include the gradual liberalization of prices, fiscal decentralization, increased autonomy for state enterprises, creation of a diversified banking system, development of stock markets, rapid growth of the private sector, and opening to foreign trade and investment. China has implemented reforms in a gradualist fashion. In recent years, China has renewed its support for state-owned enterprises in sectors it considers important to "economic security," explicitly looking to foster globally competitive national champions. After keeping its currency tightly linked to the US dollar for years, in July 2005 China revalued its currency by 2.1% against the US dollar and moved to an exchange rate system that references a basket of currencies. From mid 2005 to late 2008 cumulative appreciation of the renminbi against the US dollar was more than 20%, but the exchange rate remained virtually pegged to the dollar from the onset of the global financial crisis until June 2010, when Beijing allowed resumption of a gradual appreciation. The restructuring of the economy and resulting efficiency gains have contributed to a more than tenfold increase in GDP since 1978. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, China in 2010 stood as the second-largest economy in the world after the US, having surpassed Japan in 2001. The dollar values of China's agricultural and industrial output each exceed those of the US; China is second to the US in the value of services it produces. Still, per capita income is below the world average. The Chinese government faces numerous economic challenges, including: (a) reducing its high domestic savings rate and correspondingly low domestic demand; (b) sustaining adequate job growth for tens of millions of migrants and new entrants to the work force; (c) reducing corruption and other economic crimes; and (d) containing environmental damage and social strife related to the economy's rapid transformation. Economic development has progressed further in coastal provinces than in the interior, and by 2011 more than 250 million migrant workers and their dependents had relocated to urban areas to find work. One consequence of population control policy is that China is now one of the most rapidly aging countries in the world. Deterioration in the environment - notably air pollution, soil erosion, and the steady fall of the water table, especially in the North - is another long-term problem. China continues to lose arable land because of erosion and economic development. The Chinese government is seeking to add energy production capacity from sources other than coal and oil, focusing on nuclear and alternative energy development. In 2010-11, China faced high inflation resulting largely from its credit-fueled stimulus program. Some tightening measures appear to have controlled inflation, but GDP growth consequently slowed to near 9% for 2011. An economic slowdown in Europe is expected to further drag Chinese growth in 2012. Debt overhang from the stimulus program, particularly among local governments, and a property price bubble challenge policy makers currently. The government's 12th Five-Year Plan, adopted in March 2011, emphasizes continued economic reforms and the need to increase domestic consumption in order to make the economy less dependent on exports in the future. However, China has made only marginal progress toward these rebalancing goals.

Source : CIA

COMPANY NAME AND ADDRESS

 

WUHU HENGDA SHEETING METAL CO., LTD.

HENGDA MACHINERY INDUSTRIAL PARK, WUHU COUNTY, WUHU

ANHUI PROVINCE 241100 PR CHINA

TEL: 86 (0) 553-8765333/3120029

FAX: 86 (0) 553-3860508/8765409

 

 

EXECUTIVE SUMMARY

 

Date of Registration          : november 25, 2004

REGISTRATION NO.                  : 340221000008237

LEGAL FORM                           : Limited liabilities company

CHIEF EXECUTIVE                    : yu jianguo (LEGAL REPRESENTATIVE)

REGISTERED CAPITAL             : CNY 120,000,000

staff                                      : 190

BUSINESS CATEGORY             : manufacturing

Revenue                                : CNY 565,572,000 (AS OF DEC. 31, 2011)

EQUITIES                                 : CNY 11,933,000 (AS OF DEC. 31, 2011)

WEBSITE                                 : www.cnhdsm.cn

E-MAIL                                     : hengdaboban@163.com

PAYMENT                                : AVERAGE

MARKET CONDITION                : FAIR

FINANCIAL CONDITION             : FAIR

OPERATIONAL TREND              : FAIR

GENERAL REPUTATION           : AVERAGE

EXCHANGE RATE                     : CNY 6.25 = 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 limited liabilities company of PRC with State Administration of Industry & Commerce (SAIC) under registration No.: 340221000008237 on November 25, 2004.

 

SC’s Organization Code Certificate No.: 76901384-7

SC’s registered capital: CNY 120,000,000

 

SC’s paid-in capital: CNY 120,000,000

 

Registration Change Record:-

 

Date

Change of Contents

Before the change

After the change

--

Registration No.

3402212100863

340221000008237

 

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

 

Name of Shareholder (s)

% of Shareholding

Yu Jianguo

12.58

Zhejiang Hengda Industrial Group Co., Ltd.

70.75

Hangzhou Hengda Environmental Protection Industry Co., Ltd.

16.67

 

SC’s Chief Executives:-

 

Position

Name

Legal Representative and Chairman

Yu Jianguo

 

 

RECENT DEVELOPMENT

 

No recent development was found during our checks at present.

 

 

SHAREHOLDER CHART & BACKGROUND

 

Name                                                                                      % of Shareholding

 

Yu Jianguo                                                                                            12.58

 

Zhejiang Hengda Industrial Group Co., Ltd.                                               70.75

 

Hangzhou Hengda Environmental Protection Industry Co., Ltd.                   16.67

 

Zhejiang Hengda Industrial Group Co., Ltd.

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

Date of Registration: August 13, 2003

Registration No.: 330181000140915

Legal Form: Limited Liabilities Company

Chief Executive: Yu Jianguo

Registered Capital: CNY 120,000,000

 

Hangzhou Hengda Environmental Protection Industry Co., Ltd.

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

Date of Registration: September 29, 1995

Registration No.: 330181000032023

Legal Form: Limited Liabilities Company

Chief Executive: Che Yurong

Registered Capital: CNY 12,010,000

 

 

 

 

MANAGEMENT

 

Yu Jianguo, Legal Representative and Chairman

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

Gender: M

Age: 44

ID# 330121196805282115

Qualification: University

Working experience (s):

 

From 2004 to present, working in SC as legal representative and chairman

Also working in Zhejiang Hengda Industrial Group Co., Ltd. as legal representative

 

 

BUSINESS OPERATION

 

SC’s registered business scope includes manufacturing, processing and selling cold-rolled sheet, galvanized sheet, color coated sheet, manufacturing steel structure.

 

SC is mainly engaged in manufacturing and selling cold-rolled sheets, galvanized sheets, and color coated sheets.

 

SC’s products mainly include: cold-rolled sheet, galvanized sheet, and color coated sheet

SC sources its materials 100% from domestic market, mainly Zhejiang and Anhui. SC sells 70% of its products in domestic market, and 30% to overseas market, mainly Southeast Asian market.

 

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

 

Staff & Office:

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

SC is known to have approx. 190 staff at present.

 

SC owns an area as its operating office & factory of approx. 50,000 sq. meters at the heading address.

 

RELATED COMPANY

 

SC is known to have a subsidiary at present:

 

Shanghai Sky Industrial Development Co., Ltd.

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

Date of Registration: July 13, 2009

Registration No.: 330181000032023

Legal Form: Limited Liabilities Company

Chief Executive: Li Xiang

Registered Capital: CNY 5,000,000

 

 

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, 2010

As of Dec. 31, 2011

Cash

269,337

354,191

Notes receivable

0

0

Accounts receivable

3,434

19,845

Advances to suppliers

170,957

25,176

Other receivable

184

4,591

Inventory

95,999

103,169

Prepaid expenses

1,370

0

Other current assets

0

0

 

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

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

Current assets

541,281

506,972

Fixed assets

124,346

131,946

Construction in progress

4,359

0

Intangible assets

5,170

5,027

Long-term prepaid expenses

0

0

Deferred assets

877

618

Other non-current assets

2,501

17,500

 

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

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

Total assets

678,534

662,063

 

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

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

Short-term loans

130,000

210,000

Notes payable

319,970

307,170

Accounts payable

92,426

46,058

Wages payable

0

0

Taxes payable

-4,360

-22,838

Advances from clients

7,472

6,015

Other payable

66,180

102,009

Other current liabilities

2,347

1,716

 

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

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

Current liabilities

614,035

650,130

Non-current liabilities

0

0

 

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

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

Total liabilities

614,035

650,130

Equities

64,499

11,933

 

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

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

Total liabilities & equities

678,534

662,063

 

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

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

 

Income Statement

Unit: CNY’000

As of Dec. 31, 2011

Revenue

565,572

     Cost of sales

589,341

     Taxes and surcharges

18

     Sales expense

0

     Management expense

10,129

     Finance expense

24,402

Non-business income

2,522

     Non-business expenditure

499

Profit before tax

-52,566

Less: profit tax

0

Profits

-52,566

 

Important Ratios

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

 

As of Dec. 31, 2010

As of Dec. 31, 2011

*Current ratio

0.88

0.78

*Quick ratio

0.73

0.62

*Liabilities to assets

0.90

0.98

*Net profit margin (%)

--

-9.29

*Return on total assets (%)

--

-7.94

*Inventory / Revenue ×365

--

67 days

*Accounts receivable/ Revenue ×365

--

13 days

* Revenue/Total assets

--

0.85

* Cost of sales / Revenue

--

1.04

 

 

 

FINANCIAL COMMENTS

 

PROFITABILITY: POOR

The revenue of SC appears fairly good in its line.

SC’s net profit margin is poor.

SC’s return on total assets is poor.

SC’s cost of sales is high, comparing with its revenue.

 

LIQUIDITY: FAIR

The current ratio of SC is maintained in a fair level.

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

The inventory of SC is maintained in an average level.

The accounts receivable of SC is maintained in an average level.

The short-term loans of SC appear large.

SC’s revenue is in a fair 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: Fair.

 

 

CONCLUSIONS

 

SC is considered medium-sized in its line with fair financial conditions. The large amount of short-term loans may be a threat to SC’s financial condition.

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.52.97

UK Pound

1

Rs.85.45

Euro

1

Rs.69.45

 

 

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%)

 

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.