MIRA
INFORM REPORT
|
Report Date : |
18.07.2013 |
IDENTIFICATION DETAILS
|
Name : |
5-CONTINENT ENTERPRISE CO., LTD. |
|
|
|
|
Registered Office : |
No. 4, 25/F, Building 2, Jinhumingcheng, No. 1, Baoshan Street, Jingyang District, Deyang, Sichuan Province, 618000 Pr |
|
|
|
|
Country : |
China |
|
|
|
|
Financials (as on) : |
31.12.2012 |
|
|
|
|
Date of Incorporation : |
30.01.2004 |
|
|
|
|
Com. Reg. No.: |
510600000008380 |
|
|
|
|
Legal Form : |
Limited Liabilities Company |
|
|
|
|
Line of Business : |
selling of phosphorus chemical products |
|
|
|
|
No. of Employees : |
06 |
RATING & COMMENTS
|
MIRA’s Rating : |
Ca |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
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 |
|
Status : |
Poor |
|
Payment Behaviour : |
Slow |
|
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) |
|
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 2012 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 under 8% for 2012. An economic slowdown in Europe
contributed to China's, and is expected to further drag Chinese growth in 2013.
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 & address
5-Continent Enterprise Co., Ltd.
NO. 4, 25/F, BUILDING 2, JINHUMINGCHENG, NO.
1, BAOSHAN STREET,
JINGYANG DISTRICT, DEYANG, SICHUAN PROVINCE,
618000 PR CHINA
TEL: 86 (0)
838-2302990/2202800 FAX: 86 (0) 838-2207315
EXECUTIVE SUMMARY
INCORPORATION DATE :
JAN. 30, 2004
REGISTRATION NO. : 510600000008380
REGISTERED
LEGAL FORM : LIMITED LIABILITIES COMPANY
CHIEF EXECUTIVE :
MR. ZAN JUN (CHAIRMAN)
STAFF STRENGTH : 6
REGISTERED CAPITAL :
CNY 1,000,000
BUSINESS LINE : trading
TURNOVER : CNY 21,970,000 (unaudited, AS OF DEC.
31, 2012)
EQUITIES : CNY -5,030,000 (unaudited, AS OF
DEC. 31, 2012)
PAYMENT : AVERAGE
MARKET CONDITION : FAIR
FINANCIAL CONDITION : POOR
OPERATIONAL TREND :
FAIR
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE : CNY 6.14 = 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: The “Room 502, Flat 1, Wenhua Building, Wenmiao Plaza, Deyang, Sichuan Province” was SC’s former one, while its present should be the heading one.
SC is also known as 5-Continent Import & Export Co., Ltd., and SC also uses the name of its related company “5-Continent Phosphorus Co., Limited” as its trading name.
SC was registered as a limited liabilities company at local Administration for Industry & Commerce (AIC - The official body of issuing and renewing business license) on Jan. 30, 2004.
Company Status: Limited liabilities co. This form of business in PR
China is defined as a legal person. No more than fifty shareholders
contribute its registered capital jointly. Shareholders bear limited
liability to the extent of shareholding, and the co. is liable for its
debts only to extent of its total assets. The characteristics of this form
of co. are as follows: Upon
the establishment of the co., an investment certificate is issued to the
each of shareholders. The board of directors is
comprised of three to thirteen members. The minimum registered capital
for a co. is CNY 30,000. Shareholders may take their
capital contributions in cash or by means of tangible assets or intangible
assets such as industrial property and non-patented technology. Cash contributed by all
shareholders must account for at least 30% of the registered capital. Existing shareholders have
pre-exemption right to purchase shares of the co. offered for sale by the
other shareholders and to subscribe for the newly increased registered
capital of the co.
SC’s registered business scope includes wholesaling of red phosphorus,
phosphorus pentoxide, sodium hydroxide, phosphorus, sulfur, urea, potassium
chlorate, polyphosphoric acid, phosphorous acid. (Dangerous chemicals business
license is valid as of May 22, 2016). Selling of agricultural and livestock
products, native products (only primary edible agricultural products),
textiles, clothing, daily necessities, cultural sporting goods and equipment,
mineral products, building materials, chemical products (excluding dangerous
goods and precursor chemicals), general machinery equipment, hardware,
electronic products; import and export self -agent all kinds of goods and
technology, excluding those limited and prohibited by the State. (with permit
if needed)
SC is mainly
engaged in selling phosphorus chemical products.
Mr.
Zan Jun is legal representative, chairman and general manager of SC at present.
SC is
known to have approx. 6 employees at present.
SC is currently operating at the above stated address, and this address
houses its operating office in the commercial zone of
Deyang. Our checks reveal that SC owns the total premise about 100
square meters.
http://www.5-continentphos.com
The design is professional and the content is well organized. At present it is
in Chinese and English versions.
E-mail: phos.daisy@yahoo.com
; daisy@5-continent.cn
No significant events or changes were found during our checks with the
local Administration for Industry and Commerce.
For the past two years there is no record of litigation.
MAIN SHAREHOLDERS:
Name
%
of Shareholding
Zan Jun 50
Hong Shaoyi 30
Yang Xianhui 10
Luo Hui 5
Zhang Ying 5
Legal
Representative, Chairman and General Manager:
Mr. Zan Jun, with university education. He is currently responsible for the overall management of SC.
Working
Experience(s):
At present Working in SC as legal representative, chairman and general manager.
Supervisor:
Hong Shaoyi
SC is mainly
engaged in selling phosphorus chemical products.
SC’s products mainly include:
Citric Acid
2-Keto L-Gulonic Acid
Fumaric Acid
Thiourea Dioxide
Thiourea
Furfuryl Alcohol
2-Naphthol
Tartaric Acid
Silicon Metal
Polysilicon
2,4 Dichloro Fluoro Benzene
2,4 Dichloro Phenacyl Chloride
Ortho Chloro Phenol (Ocp)
2-4 Dichloro Phenol
1,3-Difluoro Benzene
Diphenylamine
Benzanthrone
Beta Naphthol
Quinizarine
Saccharin Sodium Salt
Hydroxylamine Hydrochloride
Anthraquinone
Acrylamide
Triethyl Orthoformate
Cimetidine
Paracetamol
Azithromycin
SC sources its materials 100% from domestic
market. SC sells 20% of its products in domestic market, and 80% to overseas
market, mainly to India.
The buying terms of SC include Check, T/T 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.
5-Continent Phosphorus Co., Limited (Hong Kong)
===========================
Incorporation date: May 24, 2012
Registration no.: 1749859
Legal form: Private
According to http://www.5-continentphos.com:
Peony Chemicals Pvt Ltd. (India)
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.
Bank of China
Deyang Branch
AC#：118501771825
Relationship:
Normal.
Balance Sheet
Unit: CNY’000
|
|
As of Dec. 31,
2012 |
As of Dec. 31,
2011 |
|
Cash & bank |
440 |
600 |
|
Notes receivable
|
0 |
0 |
|
Inventory |
150 |
3,940 |
|
Accounts
receivable |
0 |
0 |
|
Advances to
suppliers |
2,280 |
460 |
|
Other accounts
receivable |
200 |
130 |
|
Other current
assets |
10 |
0 |
|
|
------------------ |
----------------- |
|
Current assets |
3,080 |
5,130 |
|
Fixed assets net
value |
70 |
60 |
|
Project under
construction |
0 |
0 |
|
Long term
investment |
0 |
0 |
|
Long-term
prepaid expenses |
0 |
0 |
|
Project
materials |
0 |
0 |
|
Intangible and
other assets |
0 |
0 |
|
|
------------------ |
------------------ |
|
Total assets |
3,150 |
5,190 |
|
|
============= |
============= |
|
Short loans |
2,000 |
3,170 |
|
Notes payable |
0 |
0 |
|
Accounts payable
|
0 |
0 |
|
Advances from
clients |
1,830 |
4,750 |
|
Accrued payroll |
0 |
0 |
|
Welfare payable |
0 |
0 |
|
Taxes payable |
30 |
30 |
|
Surcharge payable |
0 |
0 |
|
Other accounts
payable |
3,410 |
1,450 |
|
Other current
liabilities |
0 |
0 |
|
Interest payable |
0 |
0 |
|
|
------------------ |
------------------ |
|
Current
liabilities |
7,270 |
9,400 |
|
Long-term
liabilities |
910 |
1,040 |
|
|
------------------ |
------------------ |
|
Total
liabilities |
8,180 |
10,440 |
|
Equities |
-5,030 |
-5,250 |
|
|
------------------ |
------------------ |
|
Total
liabilities & equities |
3,150 |
5,190 |
|
|
============= |
============= |
Income Statement
Unit: CNY’000
|
|
As of Dec. 31,
2012 |
As of Dec. 31,
2011 |
|
Turnover |
21,970 |
20,750 |
|
Cost of goods sold |
20,690 |
19,810 |
|
Taxes and additional of main operations |
70 |
60 |
|
Sales expense |
1,700 |
1,840 |
|
Management expense |
50 |
80 |
|
Finance expense |
380 |
470 |
|
Subsidy income |
1,160 |
320 |
|
Non-operating
income |
0 |
0 |
|
Non-operating expense |
20 |
260 |
|
Profit before
tax |
220 |
-1,450 |
|
0 |
0 |
|
|
Profits |
220 |
-1,450 |
Note: The financial reports of Yr2012 have not been audited.
Important Ratios
=============
|
|
As
of Dec. 31, 2012 |
As
of Dec. 31, 2011 |
|
*Current ratio |
0.42 |
0.55 |
|
*Quick ratio |
0.40 |
0.13 |
|
*Liabilities
to assets |
2.60 |
2.01 |
|
*Net profit
margin (%) |
1.00 |
-6.99 |
|
*Return on
total assets (%) |
6.98 |
-27.94 |
|
*Inventory
/Turnover ×365 |
3 days |
70 days |
|
*Accounts
receivable/Turnover ×365 |
/ |
/ |
|
*Turnover/Total
assets |
6.97 |
4.00 |
|
* Cost of
goods sold/Turnover |
0.94 |
0.95 |
PROFITABILITY:
AVERAGE
l
The turnover of SC appears average in both years.
l
SC’s net profit margin is fair in 2011, and average
in 2012.
l
SC’s return on total assets is poor in 2011, and
fairly good in 2012.
l
SC’s cost of goods sold is fairly high, comparing
with its turnover.
LIQUIDITY: POOR
l
The current ratio of SC is fair in 2011 but poor in
2012.
l
SC’s quick ratio is poor in both years.
l
SC’s inventory is large in 2011, and
average in 2012.
l
SC has no accounts receivable in both
years.
l
SC’s short-term loan appears large in both years.
l
SC’s turnover is fairly good in both years, comparing
with the size of its total assets.
LEVERAGE: POOR
l
The debt ratio of SC is too high.
l
The risk for SC to go bankrupt is high.
Overall financial
condition of the SC: Poor.
SC is considered small-sized in its line with poor financial
conditions. The large amount of short loans could be a threat to SC’s financial
condition.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.59.36 |
|
UK Pound |
1 |
Rs.89.69 |
|
Euro |
1 |
Rs.77.99 |
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.