MIRA
INFORM REPORT
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Report Date : |
03.04.2013 |
IDENTIFICATION DETAILS
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Name : |
MARUBENI-ITOCHU STEEL INC |
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Registered Office : |
Nihombashi 1-Chome Bldg, 1-4-1 Nihombashi Chuoku Tokyo 103-8247 |
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Country : |
Japan |
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Financials (as on) : |
31.03.2012 |
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Date of Incorporation : |
October 2001 |
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Com. Reg. No.: |
0100-01-075892 (Tokyo-Chuoku) |
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Legal Form : |
Limited Company |
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Line of Business : |
Trading house specializing in
iron & steel materials & products |
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No. of Employees : |
823 |
RATING & COMMENTS
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MIRA’s Rating : |
A |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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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 |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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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 (31.03.2012) |
Current Rating (30.06.2012) |
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Japan |
A1 |
A1 |
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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 |
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.
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Source
: CIA |
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
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 Yasuo Matsuura, v pres
Yasuhiko
Koike, mgn dir Takeshi Mitomi,
mgn dir
Yuji
Sunada, mgn dir Shuichi
Okazaki, mgn dir
Yen
Amount: In million Yen, unless
otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 1,741,637 M
PAYMENTS REGULAR CAPITAL Yen
30,000 M
TREND UP WORTH Yen 183,524 M
STARTED 2001 EMPLOYES 823
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.
Notes: Unit: In Million Yen
Forecast (or estimated) for the
31/03/2013 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/2012 fiscal term amounted to Yen 1,741,637 million, an 8% up from Yen 1,611,356 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. The recurring profit was posted at Yen 36,512 million and the net profit at Yen 25,834 million, respectively, compared with Yen 28,015 million recurring profit and Yen 13,502 million net profit, respectively a year ago.
For the current term ending Mar 2013 the recurring profit is projected at Yen 60,000 million and the net profit at 40,000 million, on a 6% rise in turnover, to Yen 1,850,000 million. Demand recovered from the auto makers. Made PSDC (USA) as its subsidiary. Set up JV in China for lamination production. Total investment is estimated around Yen 70,000 million. Business is seen expanding steadily.
The financial situation is considered FAIR and good for ORDINARY business engagements.
REGISTRATION
Date Registered: Oct
2001
Regd No.: 0100-01-075892
(Tokyo-Chuoku)
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 10,584,393 million, operating
profit Yen 157,315 million, recurring profit Yen 260,983 million, net profit
Yen 172,125 million, total assets Yen 5,290,134 million, net worth Yen 899,499
million, employees 32,445, 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 11,978,276 million, operating profit
Yen 272,620 million, recurring profit Yen 341,174 million, net profit Yen
300,505 million, total assets Yen 6,411,158 million, net worth Yen 2,354,136
million, employees 70,324, 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, IHI Marine United,
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
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FINANCES: (Consolidated
in million yen) |
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Terms Ending: |
31/03/2012 |
31/03/2011 |
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INCOME STATEMENT |
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Annual Sales |
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1,741,637 |
1,611,356 |
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Cost of Sales |
1,644,240 |
1,527,399 |
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GROSS PROFIT |
97,397 |
83,957 |
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Selling & Adm Costs |
61,359 |
57,070 |
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OPERATING PROFIT |
36,038 |
26,887 |
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Non-Operating P/L |
474 |
1,128 |
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RECURRING PROFIT |
36,512 |
28,015 |
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NET PROFIT |
25,834 |
13,502 |
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BALANCE SHEET |
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Cash |
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31,406 |
24,892 |
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Receivables |
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402,777 |
373,376 |
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Inventory |
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159,081 |
140,088 |
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Securities, Marketable |
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Other Current Assets |
48,412 |
32,565 |
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TOTAL CURRENT ASSETS |
641,676 |
570,921 |
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Property & Equipment |
53,192 |
52,499 |
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Intangibles |
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5,600 |
7,247 |
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Investments, Other Fixed Assets |
78,208 |
75,152 |
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TOTAL ASSETS |
778,676 |
705,819 |
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Payables |
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238,242 |
226,045 |
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Short-Term Bank Loans |
217,524 |
183,440 |
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Other Current Liabs |
35,800 |
27,952 |
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TOTAL CURRENT LIABS |
491,566 |
437,437 |
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Debentures |
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Long-Term Bank Loans |
94,583 |
90,490 |
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Reserve for Retirement Allw |
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Other Debts |
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9,003 |
10,213 |
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TOTAL LIABILITIES |
595,152 |
538,140 |
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MINORITY INTERESTS |
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Common
stock |
30,000 |
30,000 |
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Additional
paid-in capital |
20,537 |
20,537 |
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Retained
earnings |
138,912 |
119,562 |
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Evaluation
p/l on investments/securities |
(16,393) |
(12,529) |
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Others |
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10,468 |
10,109 |
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Treasury
stock, at cost |
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TOTAL S/HOLDERS` EQUITY |
183,524 |
167,679 |
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TOTAL EQUITIES |
778,676 |
705,819 |
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ANALYTICAL RATIOS Terms ending: |
31/03/2012 |
31/03/2011 |
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Net
Worth (S/Holders' Equity) |
183,524 |
167,679 |
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Current
Ratio (%) |
130.54 |
130.52 |
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Net
Worth Ratio (%) |
23.57 |
23.76 |
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Recurring
Profit Ratio (%) |
2.10 |
1.74 |
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Net Profit
Ratio (%) |
1.48 |
0.84 |
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Return
On Equity (%) |
14.08 |
8.05 |
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.54.33 |
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UK Pound |
1 |
Rs.82.72 |
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Euro |
1 |
Rs.69.81 |
INFORMATION DETAILS
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Report Prepared
by : |
NLM |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the
strongest capability for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable
to meet normal commitments. |
Satisfactory |
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26-40 |
B |
Capability to overcome financial difficulties
seems comparatively below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be
exercised |
Credit not
recommended |
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NB |
New Business |
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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.