MIRA
INFORM REPORT
|
Report Date : |
21.06.2013 |
IDENTIFICATION DETAILS
|
Name : |
ZHEJIANG HUAHAI PHARMACEUTICAL CO., LTD. |
|
|
|
|
Registered Office : |
Xunqiao Economic Development Zone, |
|
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Country : |
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|
|
|
Financials (as on) : |
31.12.2012 |
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|
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Date of Incorporation : |
28.02.2001 |
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|
|
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Com. Reg. No.: |
330000000027652 |
|
|
|
|
Legal Form : |
Shares Limited Company |
|
|
|
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Line of Business : |
Subject engaged in manufacturing and selling pharmaceutical preparations, API (Active Pharmaceutical Ingredient) and pharmaceutical intermediates. |
|
|
|
|
No. of Employees : |
3,891 (including its main subsidiaries) |
RATING & COMMENTS
|
MIRA’s Rating : |
Ba |
|
RATING |
STATUS |
PROPOSED CREDIT LINE |
|
|
41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
|
Status : |
Satisfactory |
|
Payment Behaviour : |
No Complaints |
|
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 an ADDRESS
Zhejiang Huahai Pharmaceutical co., ltd.
XUNQIAO ECONOMIC
DEVELOPMENT ZONE, LINHAI,
ZHEJIANG province,
317024 PR CHINA
TEL: 86 (0) 576-85010288/85016569/85991096
FAX: 86 (0)
576-85991062/85016013
EXECUTIVE SUMMARY
INCORPORATION DATE : FEB.
28, 2001
REGISTRATION NO. : 330000000027652
REGISTERED LEGAL FORM : shares limited company
STAFF STRENGTH :
3,891 (including its main subsidiaries)
REGISTERED CAPITAL : CNY 775,486,000
BUSINESS LINE : manufacturing and trading
TURNOVER :
CNY 2,014,391,000 (CONSOLIDATED, as of dec. 31, 2012)
EQUITIES :
CNY 1,949,039,000 (CONSOLIDATED, as of
dec. 31, 2012)
PAYMENT :
AVERAGE
MARKET CONDITION : COMPETITIVE
FINANCIAL CONDITION : FAIRLY
STABLE
OPERATIONAL TREND : STEADY
GENERAL REPUTATION : average
EXCHANGE RATE :
CNY 6.13= 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 Ren Min Bi
SC was registered
as a shares limited company at Zhejiang Provincial Administration for Industry
& Commerce (AIC-The official body of issuing and renewing business license)
on Feb. 28, 2001.
Company Status: Shares limited co. This form of business in PR
China is defined as a legal person. Its registered capital is divided into
shares of equal par value and the co. raises capital by issuing share
certificates by promotion or by public offer. Shareholders bear limited
liability to the extent of shareholding, and the co. is liable for its
debts only to the extent of its total assets. The characteristics of the
shares limited co. are as follows: The establishment of the co.
requires at least five promoters and at least three of them must be PR-
China controlled legal persons. Natural person can not be allowed to serve
as promoters. The minimum registered capital
of a co. is CNY The board of directors must
consist of an odd number of five to nineteen directors. If the co. raises capital by
public offer, the promoters must not subscribe less than 35% of the total
shares. the promoters’ shares are restricted to transfer- within three
years of the offer. Directors can not transfer the shares they hold in the
co. during their terms of office. A state-owned enterprise that
is restructured into a shares limited co. must comply with the conditions
& requirements specified under the law & administrative rule.
SC’s registered business scope includes manufacturing drug (range see
the People's Republic of China Pharmaceutical Production License, valid until December
2, 2015); manufacturing pharmaceutical intermediates; import and export
business.
SC is mainly
engaged in manufacturing and selling pharmaceutical preparations, API (Active
Pharmaceutical Ingredient) and pharmaceutical intermediates.
Mr. Chen Baohua is the legal representative and general
manager of SC at present.
SC is known
to have approx. 3,891 employees (including its main subsidiaries),
including 2,280 workers, 82 sales staff, 916 technical staff, 43 financial
staff, and 570 administrative staff.
SC
is currently operating at the above stated address, and this address houses its
operating office and factory in the economic development zone of Linhai. Our
checks reveal that SC covers an area of 1,200,000 square meters
http://www.huahaipharm.com/
The design is professional and the content is well organized. At present, the
web is both in Chinese and English versions.
E-mail: postmaster@huahaipharm.com
SC is a listed company in Shanghai Stock Exchange Market with the code
600521.
SC is entitled as National Key Hi-tech Enterprise, National Pilot
Enterprise of Innovation, and China’s top 500 private enterprises, and
possesses a “State Certified Enterprise Technology Center”.
· awarded with the honor of “National-recognized enterprise technology
center”
· awarded with the honor of “Special contribution to 5.12 Wen chuan
earthquake relief efforts”
· award with the honor of “National Demonstration Project for Advanced
Technology Industrialization”
· awarded with the honor of “National Environment Friendly Enterprise”
· awarded with the honor of “Five Star Enterprise of Environmental
Protection” by Zhejiang Province
· awarded with the honor of “Key Hi-Tech Enterprise of China”
Etc.
Changes
of its registered information are as follows:
|
Date of change |
Item |
Before the
change |
After the change |
|
Unknown |
Registered no. |
3300001007639 |
Present one |
|
2012 |
Registered capital |
CNY 538,607,000 |
CNY 547,448,000 |
|
2013 |
Registered capital |
CNY 547,448,000 |
Present amount |
|
Chairman |
Chen Baohua |
Present one |
For the past two years there is no record of litigation.
MAIN
SHAREHOLDERS: (As of May 17, 2013)
Name
%
of Shareholding
Chen Baohua 26.81
Zhou Minghua 20.17
China Construction Bank Corporation-
Taida Hongli Market Value Preferred Stock Securities Investment
Fund 2.31
Industrial and Commercial Bank of China-
Huitianfu Growth Focus Stock Securities Investment Fund 2.12
Industrial and Commercial Bank of China-
E Fund Value Growth Mixed Securities Investment Fund 2.09
Rongtong New Blue Chip Securities Investment Fund
1.55
Weng Zhenyu 1.40
Bank of China Limited-
E Fund Health Care Industry Stock Securities Investment Fund 1.30
National Social Security Fund 114 Combinations
1.27
Industrial and Commercial Bank of China Limited-
Huitianfu Health Care Stock Securities Investment Fund 1.15
Other Shareholders 39.83
l
Chairman:
Mr. Tong Jianxin , born in 1952 with university education. He is
currently responsible for the overall management of SC.
Working Experience(s):
Ever worked in Zhejiang Pharmaceutical Administration
Comprehensive Economic Department as commissioner;
From 2013 to present Working in SC as chairman
l
Legal representative and General manager:
Mr.
Chen Baohua , born in 1962, senior engineer, with university education. He is
currently responsible for the daily management of SC.
Working Experience(s):
Ever worked in SC as chairman;
At present Working in SC as legal representative
and general manager;
Also working in Zhejiang
Huahai Medical Sale Co., Ltd., Zhejiang Huahai Import & Export Co., Ltd.,
Linhai Huahai Pharmaceutical Equipment Co., Ltd., Shanghai Aobo
Bio-pharmaceutical Tech. Co., Ltd., Shanghai Shuanghua Biological Medicine
Technology Development Co., Ltd. etc. as legal representative
l
Vice Chairman:
Mr. Du Jun , born in 1956, with master’s
degree. He is currently responsible for the daily management of SC.
Working Experience(s):
At present Working in SC as vice chairman;
Also working in Zhejiang Meiyang International
Engineering Design Co., Ltd. as legal
representative and chairman, working in Huahai (USA) International Inc. as
general manager
SC is mainly engaged
in manufacturing and selling pharmaceutical preparations, API (Active
Pharmaceutical Ingredient) and pharmaceutical intermediates.
SC’s products mainly include: Irbesartan and
Hydrochlorothiazide Tablets, Paroxetine Hydrochloride Tablets, Irbesartan
Tablets, etc.
SC sources its
materials 50% from domestic market, and 50% from overseas market. SC sells 15%
of its products in domestic market, mainly Zhejiang province, and 85% 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 Clients:
===========
Chemo Ag Vienna Lugano Branch
Balkanpharma Dupnitza AD
Siegfried Ltd.
Luna Chemicals Co., Ltd.
Merck Sharp & Dohme Asia Pacific Services Pte Ltd.
*Major suppliers:
============
Lupin Limited
Shanghai Kingsun Pharma & Tech. Co., Ltd.
Rexam HealthCare Packaging
USV Limited
SC is known to have the following subsidiaries at present, as follows:
Linhai Huanan Chemical Co., Ltd.
……………………………………
Legal
representative: Chen Baohua
Registration
No.: 331082000033314
Incorporation
date:
Zhejiang
Huahai Medical Sale Co., Ltd.
…………………………………………
Legal
representative: Chen Baohua
Registration
No.: 331082000037750
Incorporation
date:
Zhejiang
Huahai Import & Export Co., Ltd.
…………………………………………….
Legal
representative: Chen Baohua
Registration
No.: 331082000066772
Incorporation
date:
Shanghai
Aobo Bio-pharmaceutical Tech. Co., Ltd.
……………………………………………………..
Legal
representative: Chen Baohua
Registration
No.: 310115000839119
Incorporation
date:
Shanghai
Shuanghua Biological Medicine Technology Development Co., Ltd.
…………………………………………………………………………………
Legal
representative: Chen Baohua
Registration
No.: 310115000832359
Incorporation
date:
Shanghai
SynCores Technologies, Inc.
………………………………………
Legal
representative: Chen Baohua
Registration
No.: 310115000887087
Incorporation
date:
Huahai
(USA) International Inc.
Linhai
Huahai Pharmaceutical Equipment Co., Ltd.
………………………………………………..
Legal
representative: Chen Baohua
Registration
No.: 331082000024174
Incorporation
date:
Etc.
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’s suppliers
declined to make any comments.
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.
The detailed
banking information wasn’t found in local AIC.
Consolidated
Balance Sheet
Unit: CNY’000
|
|
as
of Dec. 31, 2011 |
as
of Dec. 31, 2012 |
|
Cash & bank |
345,957 |
286,820 |
|
Trading
financial assets |
5,531 |
5,426 |
|
Bills receivable |
6,572 |
7,108 |
|
Inventory |
607,707 |
816,927 |
|
Accounts
receivable |
387,671 |
518,356 |
|
Advances to
suppliers |
10,590 |
17,464 |
|
Other accounts
receivable |
16,197 |
2,807 |
|
Other current
assets |
0 |
0 |
|
|
------------------ |
------------------ |
|
Current assets |
1,380,225 |
1,654,908 |
|
Investment real
estate |
6,390 |
6,008 |
|
Fixed assets net
value |
570,512 |
871,577 |
|
Projects under
construction |
487,272 |
388,696 |
|
Project
materials |
0 |
0 |
|
Long term
investment |
0 |
0 |
|
Intangible
assets |
118,551 |
232,949 |
|
Goodwill |
6,456 |
32,835 |
|
Other assets |
7,622 |
29,639 |
|
|
------------------ |
------------------ |
|
Total assets |
2,577,028 |
3,216,612 |
|
|
============= |
============= |
|
Short loans |
505,014 |
434,185 |
|
Bills payable |
181,123 |
196,721 |
|
Accounts payable |
159,658 |
211,074 |
|
Advances from
clients |
5,014 |
4,350 |
|
Salaries and
welfare payable |
36,820 |
50,006 |
|
Interest payable |
5,613 |
8,263 |
|
Taxes payable |
57,620 |
77,537 |
|
Other accounts payable |
15,729 |
9,828 |
|
Other current
liabilities |
43,000 |
230,000 |
|
|
------------------ |
------------------ |
|
Current
liabilities |
1,009,591 |
1,221,964 |
|
Long term
liabilities |
37,878 |
45,609 |
|
|
------------------ |
------------------ |
|
Total
liabilities |
1,047,469 |
1,267,573 |
|
Equities |
1,529,559 |
1,949,039 |
|
|
------------------ |
------------------ |
|
Total
liabilities & equities |
2,577,028 |
3,216,612 |
|
|
============= |
============= |
Consolidated
Income Statement
Unit: CNY’000
|
|
as
of Dec. 31, 2011 |
as
of Dec. 31, 2012 |
|
Turnover |
1,827,614 |
2,014,391 |
|
Cost of goods
sold |
1,103,302 |
1,203,228 |
|
Taxes and additional of main operation |
33,106 |
13,276 |
|
Sales expense |
49,275 |
83,217 |
|
Management expense |
314,415 |
322,544 |
|
Finance expense |
26,190 |
31,477 |
|
Loss of impairment of assets |
10,874 |
9,243 |
|
Income from changes
in fair value |
5,531 |
-105 |
|
Investment
income |
-21,863 |
4,668 |
|
Non-operating
income |
5,493 |
51,317 |
|
Non-operating expense |
6,458 |
5,420 |
|
Profit before
tax |
273,155 |
401,866 |
|
Less: profit tax |
59,066 |
63,372 |
|
Profits |
214,089 |
338,494 |
Important Ratios
=============
|
|
as
of Dec. 31, 2011 |
as
of Dec. 31, 2012 |
|
*Current ratio |
1.37 |
1.35 |
|
*Quick ratio |
0.77 |
0.69 |
|
*Liabilities
to assets |
0.41 |
0.39 |
|
*Net profit
margin (%) |
11.71 |
16.80 |
|
*Return on
total assets (%) |
8.31 |
10.52 |
|
*Inventory
/Turnover ×365 |
122 days |
149 days |
|
*Accounts
receivable/Turnover ×365 |
78 days |
94 days |
|
*Turnover/Total
assets |
0.71 |
0.63 |
|
* Cost of
goods sold/Turnover |
0.60 |
0.60 |
PROFITABILITY:
FAIRLY GOOD
l
The turnover of SC appears fairly good in its line,
and it increased in 2012.
l
SC’s net profit margin is good in both years.
l
SC’s return on total assets is fairly good in both
years.
l
SC’s cost of goods sold is low, comparing with its
turnover in both years.
LIQUIDITY: AVERAGE
l
The current ratio of SC is maintained in a normal
level in both years.
l
SC’s quick ratio is maintained in a fair level in
both years.
l
The inventory of SC appears large in both years.
l
The accounts receivable of SC appears average in
both years.
l
The short-term loan of SC appears fairly large in
both years.
l
SC’s turnover is in a fair level, comparing with
the size of its total assets in both years.
LEVERAGE: FAIRLY
GOOD
l
The debt ratio of SC is low in both years.
l
The risk for SC to go bankrupt is low.
Overall financial
condition of the SC: Fairly stable.
SC is considered large-sized in its line with fairly stable financial conditions.
The large amount of inventory could be a threat to SC’s financial condition.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.59.70 |
|
|
1 |
Rs.92.22 |
|
Euro |
1 |
Rs.79.18 |
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 |
|
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.