MIRA INFORM REPORT

Report Date :

07.11.2013

IDENTIFICATION DETAILS

Name :	JOTUN POWDER COATING (PAKISTAN-PRIVATE) LIMITED
Formerly Known As :	JOTUN PAKISTAN (PRIVATE) LIMITED
Registered Office :	2-KM Defence Road Off Battian Chowk, 9-KM Raiwind Road, Adjacent Valencia Homes Gate, Lahore
Country :	Pakistan
Date of Incorporation :	27.07.1995
Com. Reg. No.:	0035235
Legal Form :	Private Limited Liability Company
Line of Business :	Manufacturer, importer and distributor of powder coating products and also importer of raw material and coating powder.
No. of Employees :	52

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 :	Slow but Correct
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, 31^st, 2013

Country Name	Previous Rating (31.12.2012)	Current Rating (31.03.2013)
Pakistan	B2	B2

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

pakistan - ECONOMIC OVERVIEW

Decades of internal political disputes and low levels of foreign investment have led to slow growth and underdevelopment in Pakistan. Agriculture accounts for more than one-fifth of output and two-fifths of employment. Textiles account for most of Pakistan's export earnings, and Pakistan's failure to expand a viable export base for other manufactures has left the country vulnerable to shifts in world demand. Official unemployment is under 6%, but this fails to capture the true picture, because much of the economy is informal and underemployment remains high. Over the past few years, low growth and high inflation, led by a spurt in food prices, have increased the amount of poverty - the UN Human Development Report estimated poverty in 2011 at almost 50% of the population. Inflation has worsened the situation, climbing from 7.7% in 2007 to almost 12% for 2011, before declining to 10% in 2012. As a result of political and economic instability, the Pakistani rupee has depreciated more than 40% since 2007. The government agreed to an International Monetary Fund Standby Arrangement in November 2008 in response to a balance of payments crisis. Although the economy has stabilized since the crisis, it has failed to recover. Foreign investment has not returned, due to investor concerns related to governance, energy, security, and a slow-down in the global economy. Remittances from overseas workers, averaging about $1 billion a month since March 2011, remain a bright spot for Pakistan. However, after a small current account surplus in fiscal year 2011 (July 2010/June 2011), Pakistan's current account turned to deficit in fiscal year 2012, spurred by higher prices for imported oil and lower prices for exported cotton. Pakistan remains stuck in a low-income, low-growth trap, with growth averaging about 3% per year from 2008 to 2012. Pakistan must address long standing issues related to government revenues and energy production in order to spur the amount of economic growth that will be necessary to employ its growing and rapidly urbanizing population, more than half of which is under 22. Other long term challenges include expanding investment in education and healthcare, adapting to the effects of climate change and natural disasters, and reducing dependence on foreign donors.

Source : CIA

GENERAL INFORMATION

Business Name	JOTUN POWDER COATING (PAKISTAN-PRIVATE) LIMITED
Address	Head Office Address: 2-KM Defence Road Off Battian Chowk, 9-KM Raiwind Road, Adjacent Valencia Homes Gate, Lahore, Pakistan
Telephone	(+92) (42) 35323500
Fax	(+92) (42) 35321387
Mobile	Not provided.
Email	powderpk@jotun.com; tahir.mahmood@jotun.com
Website	http://www.jotun.com/me/en/corporate/contact/
Business activities	Manufacturer, importer and distributor of powder coating products and also importer of raw material and coating powder.

Registry Details

CRO Registration Number	0035235
Date of Registration	July 27, 1995

Other registry details:

Current Legal Form	Private Limited Liability Company
National Tax Registration Number	Not provided
Date of Registration	Not provided
GST Registration Number	Not provided
Date of Registration	Not provided

Capital

Authorized	Rs.200,000,000 divided into 20,000,000 shares of Rs.10/- each
Issued, Subscribed & Paid-Up	Rs.175,990,000 divided into 17,599,000 shares of Rs.10/- each

History

Who Started	Not provided
When Started	July 27, 1995
Change in Management	Not provided
Year of change	Not provided
Change in Legal Status	Name changed from “Jotun Pakistan (Private) Limited” to “Jotun Powder Coatings Pakistan (Private) Limited” Delta Industries (Pvt) Ltd & Jotun Powder Coatings, AS, Norway, formed a Joint Venture company named Jotun Powder Coatings Pakistan (Pvt) Ltd
Year of change	2003

PRINCIPALS (SPONSORS)

Directors	No. of Shares	Appointed On	Address
A. Razak Dawood N.I.C#. 42301-1088197-9	600,000	28-10-2011	26-Sarwar Road, Lahore
Mr. Colin Wanless Passport # 740227770	1	28-10-2011	332-Jumuirah Gala Dari Villas, Dubai UAE
Chew Al Lang Martin Passport # E-0606683D	1	28-10-2011	P.O. Box 51033 Dubai United Arab Emirates
OTHER SHARE HOLDERS
Jotun Powder Coatings AS	16,398,998
Descon Chemicals (Pvt.) Ltd	220,000
Descon Holding (Pvt.) Ltd.	180,000
Mrs. Bilquis Dawood	50,000
Mrs. Mehreen Dawood	50,000
Mr. Taimur Dawood	50,000
Mr. Faisal Dawood	50,000

KEY MANAGEMENT

Name	Position in organization	Qualification	Years in employment
Mr. Per Arne Langnes	CEO	Not provided	Not provided
Mr. Chew Al Leng Martin	Director	Not provided	Not provided
Mr. A. Razak Dawood	Director	Not provided	Not provided
Mr. Colin Wanless	Director	Not provided	Not provided

Statutory offices	Name of service provider
Statutory Auditors	Ernst & Young Ford Rhodes Sidat Hyder & Company
Legal Advisory Services	Rana Muhammad Afzal

BANKERS

Citibank

Faysal Bank

Bank Al Habib

DETAILS OF BUSINESS ACTIVITIES

Manufacturers & importers and distributor of powder coating products and also importer of raw material and coating powder.

Product names are:

Decorative paints

Marine coatings

Protective coatings

Powder coatings

Purchases (Incl. Imports)

Imports from	Europe, Far East, Norway
Importing terms	LC
Local %	60%
Local buying terms	Not disclosed

Sales (Incl. Exports)

Exports to	Middle East
Exporting terms	LC
Local %	80%
Local selling terms	30 days cash & credit

Type of Customers

Buying agents, Corporate accounts, Government bodies, Manufacturers, Auto industry, Marine industry

NUMBER OF EMPLOYEES

Nature of employment	Current Year	Previous Year
Permanent	52	52
Contractual	--	--
Daily wages	--	--
Total	52	52

BUSINESS FACILITIES:

Head office Address Owned / Rented Area (approx)	2-KM Defence Road Off Battian Chowk, 9-KM Raiwind Road, Adjacent Valencia Homes Gate, Lahore, Pakistan Rented INS*
Factory Address Owned / Rented Area (approx)	Same as above Same as above Same as above
Warehouse Address Owned / Rented Area (approx)	Plot No.2-H, Sector-5, Korangi Industrial Area, Karachi INS INS

MARKET REPUTATION

We have contacted few buyers and service providers of the subject company who confirmed SATISFACTORY business relationship of 5 to 10 years. They have confirmed that the market standing of the subject company is really very good and that they are considered as credible business partners/ suppliers.

DETAILS OF RELATED BUSINESSES

Business Name	Address	Line of Business	Percentile of Shareholding
M/s. Joutun Powder Coatings AS	Hystadveien 167 3235 Sandefjord, Norway	Not provided	93.18
Descon Holding (Pvt.) Ltd.	Not provided	Not provided	1.25
Descon Chemicals (Pvt.) Ltd	Not provided	Not provided	1.02

BUSINESS PERFORMANCE

The contact person declined to share financial information.

INTERVIEW & REPORTER COMMENTS

Contact person	Mr. Tahir Mahmood
Position	Assistant Manager Taxation
Comments	Declined to provide financial and operational information unless the name of enquirer is disclosed.

Abbreviations

INS Information Not Shared

N/A Not Applicable

INA Information Not Available

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.6192
UK Pound	1	Rs.99.60
Euro	1	Rs.83.74

INFORMATION DETAILS

Report Prepared by :

SDA

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%)

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