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Report Date : |
09.07.2013 |
IDENTIFICATION DETAILS
|
Name : |
PROJECT
STITCH (HK) LTD. |
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Formerly Known as: |
Marina Enterprise
Holdings Ltd |
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Registered Office : |
Room 1001-1002, 10/F., Nanyang Plaza, 57 Hung To Road,
Kwun Tong, Kowloon |
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Country : |
Hong Kong |
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Date of Incorporation : |
07.09.2007 |
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Com. Reg. No.: |
52195027 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Manufacturer, Importer and Exporter of all kinds of shirts, other garments |
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No. of Employees : |
Over 33,000. (As at
31-12-2012) |
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 – March 31st 2013
|
Country Name |
Previous Rating (31.12.2012) |
Current Rating (31.03.2013) |
|
Hong Kong |
A2 |
A2 |
|
Risk Category |
ECGC
Classification |
|
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 |
Hong Kong ECONOMIC OVERVIEW
Hong Kong has a free market economy, highly dependent on international
trade and finance - the value of goods and services trade, including the
sizable share of re-exports, is about four times GDP. Hong Kong levies excise
duties on only four commodities, namely: hard alcohol, tobacco, hydrocarbon
oil, and methyl alcohol. There are no quotas or dumping laws. Hong Kong''s open
economy left it exposed to the global economic slowdown that began in 2008.
Although increasing integration with China, through trade, tourism, and
financial links, helped it to make an initial recovery more quickly than many
observers anticipated, it again faces a possible slowdown as exports to the
Euro zone and US slump. The Hong Kong government is promoting the Special
Administrative Region (SAR) as the site for Chinese renminbi (RMB)
internationalization. Hong Kong residents are allowed to establish
RMB-denominated savings accounts; RMB-denominated corporate and Chinese
government bonds have been issued in Hong Kong; and RMB trade settlement is
allowed. The territory far exceeded the RMB conversion quota set by Beijing for
trade settlements in 2010 due to the growth of earnings from exports to the
mainland. RMB deposits grew to roughly 9.1% of total system deposits in Hong
Kong by the end of 2012, an increase of 59% from the previous year. The
government is pursuing efforts to introduce additional use of RMB in Hong Kong
financial markets and is seeking to expand the RMB quota. The mainland has long
been Hong Kong''s largest trading partner, accounting for about half of Hong
Kong''s exports by value. Hong Kong''s natural resources are limited, and food
and raw materials must be imported. As a result of China''s easing of travel
restrictions, the number of mainland tourists to the territory has surged from
4.5 million in 2001 to 34.9 million in 2012, outnumbering visitors from all
other countries combined. Hong Kong has also established itself as the premier
stock market for Chinese firms seeking to list abroad. In 2012 mainland Chinese
companies constituted about 46.6% of the firms listed on the Hong Kong Stock
Exchange and accounted for about 57.4% of the Exchange''s market
capitalization. During the past decade, as Hong Kong''s manufacturing industry
moved to the mainland, its service industry has grown rapidly. Growth slowed to
5% in 2011, and less than 2% in 2012. Credit expansion and tight housing supply
conditions caused Hong Kong property prices to rise rapidly and inflation to
rise 4.1% in 2012. Lower and middle income segments of the population are
increasingly unable to afford adequate housing. Hong Kong continues to link its
currency closely to the US dollar, maintaining an arrangement established in
1983.
|
Source : CIA |
PROJECT STITCH (HK) LTD.
Room 1001-1002, 10/F., Nanyang Plaza, 57 Hung To Road, Kwun Tong, Kowloon, Hong Kong.
PHONE: 852-2959 4300
FAX: 852-2148 4699
Managing Director: Mr. Joerg Reiner Kornblum
Incorporated on: 7th September, 2007.
Organization: Private Limited Company.
Capital: Nominal: HK$10,000.00
Issued: HK$1.00
Business Category: Manufacturer, Importer and Exporter.
Group Revenue: US$990,198,000 (Year ended 31-12-2012)
Group Employees: Over 33,000. (As at 31-12-2012)
Main Dealing Banker: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.
Banking Relation: Satisfactory.
Registered Head
Office:-
Room 1001-1002, 10/F., Nanyang Plaza, 57 Hung To Road, Kwun Tong, Kowloon, Hong Kong.
Holding Company:-
On Time International Ltd., British Virgin Islands.
Ultimate Holding
Company:-
Luen Thai Holdings Ltd., Cayman Islands/Hong Kong.
Associated/Affiliated
Companies:-
Luen Thai Group of Companies
Chang Jia International Ltd., British Virgin Islands.
Consolidated Transportation Services Inc., Commonwealth of Northern Mariana Islands.
CTSI Logistics (Taiwan) Inc., Taiwan.
CTSI Logistics Inc., US.
CTSI Logistics Ltd., Hong Kong.
CTSI Logistics Phils. Inc., The Philippines.
Desk Top Ltd., Hong Kong
Dluxe Bags Ltd., Hong Kong
Dluxe Bags Philippines, Inc. The Philippines.
Dongguan Luen Thai Garment Co. Ltd., China.
Dongguan Quan Thai Garment Co. Ltd., China.
Dongguan Tien-Hu Knitting Co. Ltd., China.
Dongguan Tomwell Garment Co. Ltd., China.
Dongguan Xing Hao Handbags Factory Co. Ltd., China.
Dongguan Xingxi Handbags Factory Co. Ltd., China.
Fortune Investment Overseas Ltd., British Virgin Islands.
G.J.M. (HK) Ltd., Hong Kong
GJM (Qingyuan) Light Industrial Development Ltd., China.
Golden Dragon Apparel Inc., The Philippines.
Guangzhou G.J.M. Garment Manufacturing Factory, China.
Hong Kong Guangthai International Co. Ltd., Hong Kong.
Hongquan Consulting Services (Shenzhen) Co. Ltd., China.
L & T International Group Phils. Inc., The Philippines.
Luen Thai Footwear Co. Ltd., China.
Luen Thai Footwear Macao Commercial Offshore Co. Ltd., Macao.
Luen Thai Industrial Co. Ltd., British Virgin Islands.
Luen Thai International Group Ltd., Hong Kong.
Luen Thai Macao Commercial Offshore Co. Ltd., Macao.
Manhattan Ltd., Hong Kong.
Philippine Luen Thai Holdings Corporation, The Philippines.
Shenzhen Guangtha International Ltd., China.
Shenzhen Li Da Silk Garment Co. Ltd., China.
TellaS Ltd., US.
Tien-Hu Knitters Ltd., Hong Kong.
Tien-Hu Knitting Co. (Hong Kong) Ltd., Hong Kong.
Tien-Hu Knitting Factory (Hong Kong) Ltd., Hong Kong.
Tien-Hu Trading (Hong Kong) Ltd., Hong Kong.
TMS Fashion (H.K.) Ltd., Hong Kong.
TMS International Ltd., Hong Kong.
Wonderful Choice Ltd., British Virgin Islands.
Wuxi Liantai Garments Co. Ltd., China.
Yuen Thai Holdings Ltd., British Virgin Islands.
Yuen Thai Industrial Co. Ltd., Hong Kong.
Yuen Thai Philippines Inc., The Philippines.
etc.
52195027
1165326
Group Chief Executive Officer & President: Mr. Henry Tan
Managing Director: Mr. Joerg Reiner Kornblum
Nominal Share Capital: HK$10,000.00 (Divided into 10,000 shares of HK$1.00 each)
Issued Share Capital: HK$1.00
(As per registry
dated 07-09-2012)
|
Name |
|
No.
of share |
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On Time International Ltd. P.O. Box 957, Offshore Incorporations Centre, Road Town,
Tortola, British Virgin Islands. |
|
1 = |
(As per registry
dated 07-09-2012)
|
Name (Nationality) |
Address |
|
Frank Hermann
FLEISCHER |
65 Ocean Drive, Sentosa Cove,
Sentosa, 098358 Singapore. |
|
Joerg Reiner
KORNBLUM |
House F, Pan Long Villa, 22
Hang Hau Wing Lung Road, Clearwater Bay, Kowloon, Hong Kong. |
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TAN Cho Lung, Raymond |
Flat 4, 17/F., Block B,
Fontana Gardens, Causeway Bay, Hong Kong. |
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Henry TAN |
Flat A, 18/F., Trafalgar
Court, 70 Tai Hang Road, Hong Kong. |
(As per registry
dated 07-09-2012)
|
Name |
Address |
Co.
No. |
|
Snap Services (H.K.) Ltd. |
Room 303, 3/F., St. George’s Building, 2 Ice House Street,
Central, Hong Kong. |
0138615 |
The subject was incorporated on 7th September, 2007 as a private limited liability company under the Hong Kong Companies Ordinance.
Originally the subject was registered under the name of Marina Enterprise Holdings Ltd., name changed to the present style on 14th April, 2010.
Apart from these, neither material change nor amendment has been ever traced and noted.
Activities: Manufacturer, Importer and Exporter.
Lines: All kinds of shirts, other garments, etc.
Group Employees: Over 33,000. (As at 31-12-2012)
Materials/Commodities: Imports raw materials from European countries, some Asian countries and finished
products from China.
Markets: Japan, Australia, North America, Europe, etc.
Group Revenue: US$832,002,000 (Year ended 31-12-2008)
US$774,892,000 (Year ended 31-12-2009)
US$794,017,000 (Year ended 31-12-2010)
US$956,489,000 (Year ended 31-12-2011)
US$990,198,000 (Year ended 31-12-2012)
Terms/Sales: L/C or as per contracted.
Terms/Buying: L/C, D/P, etc.
Nominal Share Capital: HK$10,000.00 (Divided into 10,000 shares of HK$1.00 each)
Issued Share Capital: HK$1.00
Group Net Profit: US$23,173,000 (Year ended 31-12-2008)
US$19,007,000 (Year ended 31-12-2009)
US$19,263,000 (Year ended 31-12-2010)
US$28,529,000 (Year ended 31-12-2011)
US$42,769,000 (Year ended 31-12-2012)
Profit or Loss: Group business is profitable every year.
Condition: Keeping in a satisfactory manner.
Facilities: Making fairly active use of general banking facilities.
Payment: Met trade commitments as required.
Commercial Morality: Satisfactory.
Banker: The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.
Standing: Good.
Project Stitch (HK) Ltd. is a wholly-owned subsidiary of On Time International Ltd. [On Time] which is a BVI-registered firm. On Time is an investment holding company in Hong Kong, and is a 60%-owned subsidiary of Luen Thai Holdings Ltd. [Luen Thai], a Cayman Islands-registered firm.
Located at the same operating office, the subject has got an associate Project Stitch Ltd. which is also 60%-owned by Luen Thai.
Luen Thai together with its subsidiaries (collectively the “Luen Thai Group”) is one of the leading apparel and accessories manufacturing and supply chain services providers worldwide. It has close partnership with brands and retailers globally, which include adidas, Coach, Dillard’s, Esprit, Fast Retailing, Limited Brands, Polo Ralph Lauren and Targus among others. It produces approximately 74 million pieces of garments and accessories annually with products ranging from casual wear, ladies’ wear (career, intimate and fashion wear), sports and active-wear, sweaters, outerwear, children’s wear and laptop bags, luxury and fashionable bags.
Luen Thai is a global leader in providing end-to-end apparel services that support its customers’ speed-to-market goals. It operates sales and designing offices, manufacturing facilities and logistics stations in Asia, America and Europe.
Since 2002, Luen Thai has embarked on a string of selective acquisitions to further build its multi-product capability. These include Glynn and Jacquelyn Manson [GJM], Tomwell Ltd. and Tien Hu. Joint ventures were also made with industry giants such as Yue Yuen, TMS, Tien-Hu Group and Guangdong Foreign Trade Group Co. Ltd.
In July 2004, Luen Thai was listed on The Stock Exchange of Hong Kong Ltd. bearing stock code 311, and had become the holding company of the Luen Thai Group. The latest partnership involves Desk Top to produce laptop bags, fashion bags, backpacks, etc.
Luen Thai entered into an agreement to acquire 50% stake in On Time and its subsidiaries (collectively the “On Time Group”) on 10th March, 2006. The subject is also a member of the On Time Group.
On Time Group is principally engaged in the design, sourcing and distribution on a worldwide basis of garments and other textile products. Established in the early 1990s, its headquarter is located in Hong Kong with offices in Asia Pacific. The acquisition is able to further enhance Luen Thai’s design capabilities, which along with its production scale, speed up turnaround times and bring in more European business to the Group.
In April 2007, Luen Thai Group exercised the call option to acquire an additional 10% interest in On Time, a subsidiary from the minority shareholder at an estimated consideration of approximately US$4,553,000 and consequently a goodwill of approximately US$2,308,000 has been recognized. Since then, Luen Thai Group has been holding 60% interests of the subject.
For the year ended 31st December 2012, the Group’s revenue amounted to approximately US$990,198,000, representing an increase of approximately 3.5% over 2011 which was US$ US$956,489,000. The Group produced about 90 million units of apparel and accessory products in 2012 representing an increase of 13.9% over 2011. The slight increase in revenue was mainly due to (1) the consolidation of the operations of Yuen Thai Group, (2) the acquisition of footwear business during the year, (3) the continuous growth of luxury bags business during the year, (4) the decrease in average selling price as a result of the decrease in cotton price and (5) the decline in the European business under the Life-style Apparel Division. Luen Thai’s overall gross profit for 2012 was approximately US$170,058,000, representing an increase of approximately US$9,125,000 over 2011.
The overall gross profit margin in 2012 was approximately 17.2%, representing a slight increase of 0.4 percentage point over 2011. The increase in gross profit was mainly due to the elimination of non-profitable accounts, cost savings for production in Southeast Asia countries and the continuous growth in Accessories Division. The Group’s operating expenses (including the selling and distribution expenses and the general and administrative expenses) remained relatively stable in 2012 with a slight increase of approximately 0.4% over 2011.
As a result, the profit attributable to the owners of the Company increased to approximately US$38,635,000 as compared to approximately US$34,310,000 in 2011, representing a year-on-year increase of approximately US$4,325,000 or 12.6%.
Apparel businesses, comprising the Group’s Casual and Fashion Apparel Division, Sweaters Division and Life-style Apparel Division, are the Group’s major source of revenue. These include the Group’s OEM apparel manufacturing, apparel sourcing and trading business, which accounted for approximately 71.1% of the Group’s total revenue in 2012.
Despite the consolidation of Yuen Thai Group’s results in 2012, the revenue of the Casual and Fashion Apparel Division in 2012 decreased by 2.5% to approximately US$427,646,000 when compared to 2011. Such decrease was mainly due to the decrease in average selling price as a result of the decrease in cotton price. The segment profit of Casual and Fashion Apparel Division is approximately US$33,618,000 representing an increase of 130.4% over 2011. The segment profit margin of 7.9% in 2012 is about 4.6 percentage point over 2011. The good segment results was due to (1) the recovery of orders from a substantial Japan customer, the orders from which was affected negatively as a result of the Japan earthquake in March 2011; (2) cost saving due to the wage differential between China and the Philippines and (3) the continuous strong performance of the ladies wear business within the Casual and Fashion Apparel Division.
The apparel business from the Life-style Apparel Division experienced a tough time for the year, which recorded a segment loss of approximately US$4,817,000. In view of the unstable economic environment in Europe and the shrinking demand from one of our major European customers, a goodwill of approximately US$6,896,000 was written down from Life-style Apparel Division with reference to a valuation performed by an independent valuer. If this onetime impairment of goodwill was not taken into account, the Life-style Apparel Division should have been making a profit of approximately US$2,079,000 in was 2012.
The Sweaters Division has reported a segment profit of approximately US$4,351,000 for 2012, representing an increase of 34.9% over 2011. The acquisition of Tien-Hu Knitting Company (Hong Kong) Limited and its operating subsidiary in Dongguan during the year has streamlined the operations of the Sweaters Division and improved its flexibility and production efficiency in taking customers orders.
The Luen Thai Group has over 33,000 employees worldwide as at the year ended 31st December 2012.
The subject is fully supported by the Luen Thai Group.
On the whole, consider the subject good for normal business engagements.
REMARKS:
Brief personal
history of the principal director:-
Mr. Henry TAN, BBS, JP, aged 59, is the Chief Executive Officer and President of the Group and son of Dr. Tan Siu Lin, the founder and Chairman of the Group. Mr. Tan is also a member of the Remuneration Committee and the Bank Facility Committee. Mr. Tan joined the Group in January 1985 and has over 28 years of experience in apparel and logistics industries. Mr. Tan is also an Independent non-executive director of Kingboard Chemical Holdings Ltd. Mr. Tan acts as committee member of the Chinese People’s Political Consultative Conference in Fujian and the member of Standing Committee of the Chinese People’s Political Consultative Conference in Qingyuan City of Guangdong Province. Mr. Tan also acts as the executive vice chairman of China Council for the Promotion of Peaceful National Reunification of Hong Kong Region, vice president of Overseas Chinese Economic and Cultural Foundation of China, member of Garment Advisory Committee of Hong Kong Trade Development Council and the council member of Huaqiao University. Mr. Tan is the past Chairman of Po Leung Kuk, an authorized charity organization in Hong Kong. Mr. Tan obtained his Master’s degree in Business Administration and Bachelor’s degree in Business Administration from the University of Guam.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.05 |
|
UK Pound |
1 |
Rs.90.89 |
|
Euro |
1 |
Rs.78.27 |
INFORMATION DETAILS
|
Report Prepared
by : |
MNL |
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.