MIRA INFORM REPORT

 

 

Report Date :

08.05.2013

 

IDENTIFICATION DETAILS

 

Name :

IPONGA COTTON COMPANY LTD

 

 

Registered Office :

Scott Road Blantyre Chichiri

 

 

Country :

Malawi

 

 

Year of Establishments:

1998

 

 

Legal Form :

Limited Corporation 

 

 

Line of Business :

Subject operate production and processing of cotton

 

 

No. of Employees :

150

 

 

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)

Malawi

C1

C1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

 

Malawi ECONOMIC OVERVIEW

 

Landlocked Malawi ranks among the world's most densely populated and least developed countries. The economy is predominately agricultural with about 80% of the population living in rural areas. Agriculture, which has benefited from fertilizer subsidies since 2006, accounts for one-third of GDP and 90% of export revenues. The performance of the tobacco sector is key to short-term growth as tobacco accounts for more than half of exports. The economy depends on substantial inflows of economic assistance from the IMF, the World Bank, and individual donor nations. In 2006, Malawi was approved for relief under the Heavily Indebted Poor Countries (HIPC) program. In December 2007, the US granted Malawi eligibility status to receive financial support within the Millennium Challenge Corporation (MCC) initiative. The government faces many challenges including developing a market economy, improving educational facilities, facing up to environmental problems, dealing with the rapidly growing problem of HIV/AIDS, and satisfying foreign donors that fiscal discipline is being tightened. Since 2005 President BANDA'S government has exhibited improved financial discipline under the guidance of Finance Minister Goodall GONDWE and signed a three year Poverty Reduction and Growth Facility worth $56 million with the IMF. The government has announced infrastructure projects that could yield improvements, such as a new oil pipeline for better fuel access, and the potential for a waterway link through Mozambican rivers to the ocean for better transportation options. Since 2009, however, Malawi has experienced some setbacks, including a general shortage of foreign exchange, which has damaged its ability to pay for imports, and fuel shortages that hinder transportation and productivity. Investment fell 23% in 2009, and continued to decline in 2010. The government has failed to address barriers to investment such as unreliable power, water shortages, poor telecommunications infrastructure, and the high costs of services. Donors, who provided an average of 36% of government revenue in the past five year, suspended general budget support for Malawi in 2011 due to a negative IMF review and governance issues.

 

Source : CIA

 

 

SUBJECT'S NAME   

 

Registered Name:                                   IPONGA COTTON COMPANY LTD

Requested Name:                                   IPONGA COTTON COMPANY LTD

Other Names:                                          None

 

 

ADDRESS AND TELECOMMUNICATION

 

Physical Address:                                   Scott Road Blantyre Chichiri,

Postal Address:                                      P. o. Box No. 2519

                                                              Blantyre,

Country:                                                 Malawi

Phone:                                                   265-1-676188

Cell:                                                       265-999950372

Fax:                                                       265-1-676188

Email:                                                     None

Website:                                                 None

 

 

LEGAL

 

Legal Form:                                                     Limited Corporation 

Date Incorporated:                                           1998

Reg. Number:                                                  Malawi

Nominal Capital                                                MWK. 1,000,000

Subscribed Capital                                           MWK. 1,000,000

 

Subscribed Capital is Subscribed in the following form:

                                                                       Position                          Shares

Mr. Jesse K. Kitta                                            Director                          

Mr. Johnson K. Kitta                                        Director                          

 

 

RELATED COMPANIES  

 

None                                                               Parent company.

None                                                               Subsidiary company.

None                                                               Affiliated company.

None                                                               Shareholder of subject firm.

None                                                               Branches of the firm

 

OPERATIONS

 

Registered to operate production and processing of cotton

 

Imports:                                                           Asia

Exports:                                                          Neighboring countries

Trademarks:                                                     None

Terms of sale:                                                  Cash (40%) and 25-90 days (60%), invoices.

                                                                      

Main Customers:                                              Industries, firms and organizations

Employees:                                                     150 employees.

Vehicles:                                                         Several motor vehicles.

Territory of sales:                                             Malawi

Location:                                                         Owned premises, 50,000 square feet,

 

 

AUDITORS AND INSURANCE   

 

Auditors:                                                         Information not available.

Insurance Brokers:                                            Information not available.

                                                                      

 

FINANCE 

 

Currency Reported:                                          Malawian Kwacha (MWK.)

Approx. Ex. Rate:                                            1 US Dollar = 380.19 Malawian Kwacha

Fiscal Year End:                                              December 31, 2012

Inflation:                                                          According to information given by independent sources, the

                                                                       inflation at December 31st, 2012 was of 13%.

 

Financial Information not Submitted              

                                                                      

Profit and Loss (expressed in USD.)

                                                                                         2012

Sales                                                                                 25,000,000

 

 

BANK 

 

Bank Name:                                                     NBS BANK

Branch:                                                            Malawi

Comments:                                                      None

                                                                      


TRADE REFERENCES    

 

Experiences:                                                    Good

                                                                      

 

NOTARIAL BONDS   

 

None

 

COMMENTS / ADDITIONAL INFORMATION    

 

This information was obtained from outside sources other than the subject company itself and confirmed the above subject.

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.54.27

UK Pound

1

Rs.84.32

Euro

1

Rs.70.99

 

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%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.