MIRA INFORM REPORT
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Report Date : |
25.01.2013 |
IDENTIFICATION DETAILS
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Name : |
SUN HONG
OPTRONICS ltd. |
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Registered Office : |
No. 10 Shengrong Road, No. 34
Area, Zhongkai H-Tech Zone, Huizhou
City, Guangdong, 516006 Pr |
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Country : |
China |
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Financials (as on) : |
31.12.2012 |
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Date of Incorporation : |
19.05.2005 |
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Com. Reg. No.: |
441300400014931 |
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Legal Form : |
Wholly Foreign-Owned Enterprise |
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Line of Business : |
Engaged in designing, developing, manufacturing,
processing and trading of films and sheets. |
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No. of Employees : |
400 |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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
|
Country Name |
Previous Rating (31.03.2012) |
Current Rating (30.06.2012) |
|
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.
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Source : CIA |
Company
name and address
NO. 10 SHENGRONG
ROAD, NO. 34 AREA, ZHONGKAI H-TECH ZONE,
HUIZHOU
CITY, GUANGDONG, 516006 PR CHINA
TEL: 86
(0) 752-2776868-77807 FAX: 86 (0) 752-2776867
EXECUTIVE SUMMARY
INCORPORATION DATE : MAY
19, 2005
REGISTRATION NO. :
441300400014931
REGISTERED LEGAL FORM : WHOLLY FOREIGN-OWNED ENTERPRISE
STAFF STRENGTH :
400
REGISTERED CAPITAL : USD 11,200,000
BUSINESS LINE : DESIGNING, DEVELOPING,
MANUFACTURING, PROCESSING AND TRADING
TURNOVER :
CNY 660,399,818 (UNAUDITED, AS
OF DEC. 31, 2012)
EQUITIES :
CNY 125,497,582 (UNAUDITED, AS OF DEC. 31, 2012)
PAYMENT :
AVERAGE
MARKET CONDITION :
COMPETITIVE
FINANCIAL CONDITION :
FAIRLY STABLE
OPERATIONAL TREND : STEADY
GENERAL REPUTATION :
AVERAGE
EXCHANGE RATE : CNY 6.2204=
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: SC is also known as Sun
Hong Optronics (Huizhou) Limited.
SC was registered as a wholly foreign-owned enterprise at local
Administration for Industry & Commerce (AIC - The official body of issuing
and renewing business license) on May 19, 2005.
Company Status: Wholly foreign-owned enterprise This
form of business in PR China is defined as a legal person. It is a limited
co. established within the territories of PR China with capital provided
totally by the foreign investors. More than one foreign investor may
jointly invest in a wholly foreign-owned enterprise. The investing
party/parties solely exercise management, reap profit and bear risks and
liabilities by themselves. This form of companies usually have a limited
duration is extendible upon approval of Examination and Approval
Authorities.
SC’s registered business scope includes manufacturing and selling BMC
compounds & molding materials (unsaturated polyester composite materials)
and products, LCD optical films (diffusion films (sheets), reflection sheets,
polarizer films (sheets)), assembling and designing LCD modules. Designing,
developing, processing and servicing of light panels modules & back light
modules. Products are sold both in domestic market and to overseas market. Designing,
developing, manufacturing and processing BMC granular module materials,
engineering plastics, UV cured coating, epoxy resin, compound materials and
products of glass fiber & carbon fiber woven clothes or prepreg, LCD &
touch panel optical films & sheets & related materials, LED materials,
solar products and auxiliary products (excluding hazardous chemicals). Products
are sold both in domestic market and to overseas market. Wholesale, importing
and exporting of similar products (no shops, excluding state controlled trade;
with permit if needed)
Mr. Lin Zhiming is
legal representative and general manager of SC at present.
SC is known
to have approx. 400 employees at present.
SC is currently operating at the above stated address, and this address houses its operating office and factory in the H-Tech zone of Huizhou. Detailed premise information is not available at present.
www.wahhong.com.tw The web belongs
to Wah Hong Industrial Corp. in Taiwan. The design is professional and the
content is well organized. At present it is in Chinese and English versions.
No significant changes were found during our checks with the local
Administration for Industry and Commerce.
MAIN SHAREHOLDERS:
Name %
of Shareholding
Wah
Hong International Limited 100
l Legal
Representative and General Manager:
Mr. Lin Zhiming is currently responsible for
the daily management of SC.
Working Experience(s):
At present Working in SC as legal representative and general manager.
Also working in Xiamen Guang
Hong Optoelectronics Co., Ltd. and Huizhou Xinyao Trading Co., Ltd. as legal
representative
l Chairman:
Mr. Zhang Ruiqin, Taiwanese,
is currently responsible for the overall management of SC.
Working Experience(s):
At present Working in SC as chairman.
SC is mainly
engaged in designing, developing, manufacturing, processing and trading of films and sheets.
SC’s products mainly include:
Optical film,
sheet for LCD uses
Diffusion film for LCD Back Light modules
Reflection film for LCD Back Light modules
Light guide for LCD Back Light modules
Polarizer film for LCD
Bulk Molding
Compounds (BMC)
Optical grade BMC
Electric grade BMC
High performance
“dry mix” thermosetting molding compounds
Engineering
plastic
Conductive Engineering Plastic
Special Application Engineering Plastic
LCD module
Optical film for
touch panel use
CON Film
Optical Clear Adhesive (OCA)
ITO Film
Etc.
SC sources its materials 10% from domestic
market and 90% from overseas market. SC sells 50% of
its products in domestic market, 50% to overseas market, mainly to Taiwan, Hong
Kong, etc.
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.
Note:
SC’s management declined to release its major clients and suppliers.
Wah Hong Industrial Corp. (Taiwan)
=======================
Add,:
Tel: 886 (0)7-9717777
Fax: 886 (0)7-9717787
Web: www.wahhong.com.tw
Xiamen Guang Hong Optoelectronics Co., Ltd.
===================================
Registration
No.: 350200400002828
Legal
representative: Mr. Lin Zhiming
Incorporation
date: May 15, 2007
Registered
capital: USD 8,500,000
Huizhou Xinyao Trading Co., Ltd.
(literal translation)
===================================
Registration
No.: 441300000101638
Legal
representative: Mr. Lin Zhiming
Incorporation
date: Feb. 4, 2010
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: 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.
No bank
information was found during our checks with the local Administration for
Industry and Commerce. And SC declined to release its banking details.
Balance Sheet (Unaudited)
Unit: CNY
|
|
as of Dec. 31, 2012 |
|
Cash & bank |
34,271,031 |
|
Inventory |
110,210,496 |
|
Accounts
receivable |
267,373,499 |
|
Short-term
investment |
0 |
|
Dividends
receivable |
0 |
|
Interest
receivable |
0 |
|
Subsidies
receivable |
0 |
|
Advances to
suppliers |
12,273,136 |
|
Notes receivable |
76,232,621 |
|
Other
receivables |
589,416 |
|
Prepaid expenses |
0 |
|
|
------------------ |
|
Current assets |
500,950,199 |
|
Fixed assets net
value |
83,002,576 |
|
Long term
investment |
7,979,706 |
|
Projects under
construction |
2,197,204 |
|
Intangible
assets |
5,408,447 |
|
Long-term
deferred expenses |
0 |
|
|
------------------ |
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Total assets |
599,538,132 |
|
|
============= |
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Short loans |
106,997,000 |
|
Accounts payable |
336,061,947 |
|
Advances from
clients |
0 |
|
Accrued payroll |
4,752,229 |
|
Welfares payable |
0 |
|
Taxes payable |
11,317,387 |
|
Other accounts
payable |
14,911,987 |
|
Other payable to
government |
0 |
|
Accrued expenses |
0 |
|
|
------------------ |
|
Current
liabilities |
474,040,550 |
|
Long term
liabilities |
0 |
|
|
------------------ |
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Total
liabilities |
474,040,550 |
|
Equities |
125,497,582 |
|
|
------------------ |
|
Total
liabilities & equities |
599,538,132 |
|
|
============= |
Income Statement (Unaudited)
Unit: CNY
|
|
as of Dec. 31,
2012 |
|
Turnover |
660,399,818 |
|
Cost of goods
sold |
610,435,190 |
|
Taxes
and additional of main operation |
1,228,367 |
|
Sales expense |
9,383,592 |
|
Management expense |
16,161,716 |
|
Finance expense |
1,250,474 |
|
Investment
income |
2,320,127 |
|
Non-operating
income |
247,716 |
|
Non-operating expense |
94,511 |
|
Profit before
tax |
24,413,811 |
|
Less: profit tax |
6,126,410 |
|
Profits |
18,287,401 |
Important Ratios
=============
|
|
as
of Dec. 31, 2012 |
|
*Current ratio |
1.06 |
|
*Quick ratio |
0.82 |
|
*Liabilities
to assets |
0.79 |
|
*Net profit
margin (%) |
2.77 |
|
*Return on
total assets (%) |
3.05 |
|
*Inventory
/Turnover ×365 |
61 days |
|
*Accounts
receivable/Turnover ×365 |
148 days |
|
*Turnover/Total
assets |
1.10 |
|
* Cost of
goods sold/Turnover |
0.92 |
PROFITABILITY:
FAIRLY GOOD
l
The turnover of SC appears fairly good in its line.
l
SC’s net profit margin is average.
l
SC’s return on total assets is average.
l
SC’s cost of goods sold is average, comparing with
its turnover.
LIQUIDITY: AVERAGE
l
The current ratio of SC is fair.
l
SC’s quick ratio is normal.
l
SC’s inventory is average in 2012.
l
SC’s account receivable is fairly large
in 2012.
l
SC’s short loan is fairly large.
l
SC’s turnover is in an average level, comparing
with the size of its total assets.
LEVERAGE: AVERAGE
l
The debt ratio of SC is fairly high.
l
The risk for SC to go bankrupt is average.
Overall financial
condition of the SC: Fairly stable.
SC is considered medium-sized in its line with fairly stable
financial conditions. The large amount of account receivable and short loan could be the threat
to SC’s financial conditions. Taking into consideration of SC's operation size
and development history, we would rate SC as an average credit risk company.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.53.85 |
|
|
1 |
Rs.85.25 |
|
Euro |
1 |
Rs.71.72 |
INFORMATION DETAILS
|
Report Prepared
by : |
PDT |
RATING EXPLANATIONS
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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.