MIRA
INFORM REPORT
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Report Date : |
04.02.2013 |
IDENTIFICATION DETAILS
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Name : |
FOSHAN SHUNDE LANGMEI CARPET PRODUCTS CO., LTD. |
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Registered Office : |
No. 5-7, Xinxiang Road, Wusha, Daliang Street, Shunde District, Foshan, Guangdong Province, 528000 Pr |
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Country : |
China |
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Financials (as on) : |
30.11.2012 |
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Date of Incorporation : |
05.02.2007 |
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Com. Reg. No.: |
440681400001655 |
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Legal Form : |
Chinese-Foreign Equity Joint Venture Enterprise |
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Line of Business : |
Manufacturing and selling different sorts of carpets |
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No. of Employees : |
250 |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Maximum Credit Limit: |
USD 250,000 |
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Status : |
Moderate |
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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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China |
A2 |
A2 |
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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 |
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
FOSHAN SHUNDE LANGMEI CARPET PRODUCTS Co., Ltd.
No. 5-7, XINXIANG
ROAD, WUSHA, DALIANG STREET, SHUNDE DISTRICT,
FOSHAN, GUANGDONG
PROVINCE, 528000 PR CHINA
TEL: 86 (0)
757-28083133 FAX: 86 (0)
757-28083383/ 29282229
EXECUTIVE SUMMARY
INCORPORATION DATE : feb.
5, 2007
REGISTRATION NO. : 440681400001655
REGISTERED LEGAL FORM : CHINESE-FOREIGN EQUITY
JOINT VENTURE ENTERPRISE
STAFF STRENGTH :
250
REGISTERED CAPITAL : usd 45,000,000
BUSINESS LINE : MANUFACTURING
TURNOVER :
CNY 9,810,000 (Jan. 1 to Nov. 30,
2012)
EQUITIES :
CNY 195,010,000 (AS OF Nov. 30, 2012)
PAYMENT :
AVERAGE
RECOMM. CREDIT RANGE : C.O.D.
MARKET CONDITION : AVERAGE
FINANCIAL CONDITION : fairLY STABLE
OPERATIONAL TREND : FAIRLY STEADY
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE :
CNY
6.22 = USD 1
Adopted abbreviations:
ANS - amount not stated
NS - not stated
SC - subject company (the company inquired by you)
NA - not available
CNY - China Yuan Renminbi
Note: according to SC’s accountant Ms. Li, the given name
Guangdong TFC (Hong Kong) Limited is SC’s customer and supplier.
SC was registered as a Chinese-foreign equity joint venture enterprise
at local Administration for industry & commerce (AIC - the official body of
issuing and renewing business license) on Feb. 5, 2007.
Company Status: Chinese-foreign equity joint venture
enterprise This form of business in PR
China is defined as a legal person. It is a limited co. jointly invested by
one or more foreign companies and one or more PR China controlled companies
within the territories of PR China according to a certain proportion of capital
investment. The investing parties exercise business management, share
profits and bear all risks and liabilities of the co. together. The equity
joint venture law requires that foreign party contribute not less than 25%
of the registered capital, with no maximum. The investing parties are free
to agree on method of profit distribution and liabilities bearing according
to the proportion of capital investment. Each investing parties contributes
funds, tangible assets, technology & etc. The board of directors
excises the high authority. The joint venture usually has a limited
duration of 10 to 50 years. Enterprise with large investment, long
construction periods, low investment returns, introducing of advanced
technology & advanced technology products that have good competition
position in international market may extend beyond the 50 years limit.
SC’s registered
business scope includes manufacturing and selling differential chemical fiber, high-grade
nylon carpet, high-grade wool carpet, high-grade tufted carpet, high-grade
carpet tile, yarn, styrene-butadiene latex and carboxylic styrene butadiene
latex.
SC is mainly
engaged in manufacturing and selling different sorts of carpets.
Mr. Liang
Weiqing is legal representative and
chairman of SC at present.
SC is known to have approx. 250 employees at present.
SC
is currently operating at the above stated address, and this address houses its
operating office and factory in the industrial zone of Foshan. The detailed
information of the premise is unspecified.
http://www.tfccarpet.com/
The design is professional and the content is well organized. At present it is in
both Chinese and English versions.
Email: sam.li@naturaltfc.com;
cherie@naturaltfc.com
No significant events or changes were found during our checks with the
local Administration for Industry and Commerce.
SC is also known as TFC Carpet Co., Ltd.
SC started its normal operation since Oct., 2011.
MAIN SHAREHOLDERS:
Name %
of Shareholding
Design Materials Inc. (U.S.A.) 80
TFC International Limited (Hong Kong) 10
Foshan Shunde Zhenmei Investment Management
Co., Ltd. 10
Design Materials Inc. (U.S.A.)
=======================
Add: 241 S. 55th St., Kansas City, KS 66106
Fax: 913-342-9826
Web: http://www.dmikc.com
E-mail: info@dmifloors.com
TFC International Limited (Hong Kong)
=============================
CR No.: 0652205
Date of Incorporation:
12-August-1998
Company Status: Private
Active Status: Live
Foshan Shunde
Zhenmei Investment Management Co., Ltd.
===========================================
Registered no.:
440681000196416
Legal
representative: Liang Xiaoyi
Registered
capital: CNY 500,000
Legal form:
limited liabilities co.
l
Legal representative and Chairman:
Mr. Liang Weiqing is currently
responsible for the overall management of SC.
Working Experience(s):
At present Working
in SC as legal representative and chairman.
SC started its normal operation since Oct., 2011.
SC is mainly
engaged in manufacturing and selling different sorts of carpets.
SC’s products mainly
include: residential carpet, commercial carpet, and so on.
SC sources its materials 90% from domestic
market, and 10% from overseas market. SC sells 70% of its products in domestic
market, and 30% to overseas market.
The buying terms of SC include Check, T/T, L/C and Credit of 30-60 days.
The payment terms of SC include Check, T/T, L/C and Credit of 30-60 days.
*Major Supplier:
=============
Guangdong TFC (Hong Kong) Limited
*Major Customer:
==============
Guangdong TFC
(Hong Kong) Limited
SC
is not known to have any subsidiary at present.
Overall payment appraisal :
( ) Excellent (
) Good (X) Average (
) Fair ( ) Poor
( ) Not yet 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 : we were unable to
get contact with SC’s supplier, so the trade reference is not available.
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.
SC’s management
declined to release its bank details.
Balance Sheet (as of Nov. 30, 2012)
Unit: CNY’000
|
Cash & bank |
7,200 |
|
Inventory |
33,020 |
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Accounts
receivable |
0 |
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Advances to
suppliers |
85,750 |
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Other
receivables |
19,290 |
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Other current
assets |
0 |
|
|
------------------ |
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Current assets |
145,260 |
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Fixed assets net
value |
139,970 |
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Projects under
construction |
83,350 |
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Long term
investment |
0 |
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Intangible
assets |
27,480 |
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Other assets |
0 |
|
|
------------------ |
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Total assets |
396,060 |
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|
============= |
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Short loans |
88,140 |
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Notes payable |
10,360 |
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Accounts payable |
170 |
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Other payable |
44,180 |
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Taxes payable |
-23,170 |
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Advances from
clients |
6,510 |
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Other current
liabilities |
1,260 |
|
|
------------------ |
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Current
liabilities |
127,450 |
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Long term
liabilities |
73,600 |
|
|
------------------ |
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Total
liabilities |
201,050 |
|
Equities |
195,010 |
|
|
------------------ |
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Total
liabilities & equities |
396,060 |
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|
============= |
Income Statement (Jan. 1 to Nov. 30, 2012)
Unit: CNY’000
|
Turnover |
9,810 |
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Cost of goods
sold |
14,660 |
|
Sales expense |
960 |
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Management expense |
9,140 |
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Finance expense |
10,760 |
|
Profit before
tax |
-25,710 |
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Less: profit tax |
0 |
|
Profits |
-25,710 |
Important Ratios
=============
|
|
as
of Nov. 30, 2012 |
|
*Current ratio |
1.14 |
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*Quick ratio |
0.88 |
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*Liabilities
to assets |
0.51 |
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*Net profit
margin (%) |
-262.08 |
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*Return on
total assets (%) |
-6.49 |
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*Inventory
/Turnover ×365 |
1,229 days |
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*Accounts receivable/Turnover
×365 |
/ |
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*Turnover/Total
assets |
0.02 |
|
* Cost of
goods sold/Turnover |
1.49 |
PROFITABILITY:
FAIR
l
The turnover of SC appears average in its line.
l
SC’s net profit margin is poor.
l
SC’s return on total assets is fair.
l
SC’s cost of goods sold is TOO HIGH, comparing with
its turnover.
LIQUIDITY: AVERAGE
l
The current ratio of SC is maintained in a normal
level.
l
SC’s quick ratio is maintained in a normal level.
l
The inventory conversion period of SC appears too
long.
l
SC has no accounts receivable from Jan. 1 to Nov.
30, 2012.
l
SC’s short-term loan appears large.
l
SC’s turnover is in a poor level, comparing with
the size of its total assets.
LEVERAGE: AVERAGE
l
The debt ratio of SC is average.
l
The risk for SC to go bankrupt is average.
Overall financial condition of the SC:
Fairly stable.
CREDIT OPINION: USD 250,000
SC started its normal operation since Oct., 2011. SC is considered medium-sized
in its line with fairly stable financial conditions. A credit line at the above
amount appears to be beyond SC’s capacities, while C.O.D. is recommended at present.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.53.32 |
|
|
1 |
Rs.84.60 |
|
Euro |
1 |
Rs.72.63 |
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 |
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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 |
|
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 |
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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 |
|
<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.