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Report Date : |
14.11.2013 |
IDENTIFICATION DETAILS
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Name : |
ROTEM AMFERT NEGEV LTD. |
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Formerly Known As : |
ROTEM FERTILIZERS LTD |
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Registered Office : |
P.O. Box 75, Beer Sheva (8410001) P.O. Box 187, Yeruham
(8055101) 1 Kroitzer Street,
"Ashlag" (Potash) House, Beer Sheva 8489414 |
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Country : |
Israel |
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Date of Incorporation : |
09.10.1977 |
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Legal Form : |
Private Limited Company |
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Line of Business : |
Producers, exporters and marketers of a varitey of
products based on phosphate rock mined in the Negev Desert, including
phosphate fertilizers, phosphoric acid and specialty fertilizers. |
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No. of Employees : |
1,200 employees |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Good |
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Payment Behaviour : |
Regular |
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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) |
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Israel |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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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 |
israel - ECONOMIC OVERVIEW
Israel has a technologically advanced market economy. Its
major imports include crude oil, grains, raw materials, and military equipment.
Cut diamonds, high-technology equipment, and pharmaceuticals are among the
leading exports. Israel usually posts sizable trade deficits, which are covered
by tourism and other service exports, as well as significant foreign investment
inflows. The global financial crisis of 2008-09 spurred a brief recession in
Israel, but the country entered the crisis with solid fundamentals - following
years of prudent fiscal policy and a resilient banking sector. The economy has
recovered better than most advanced, comparably sized economies. In 2010,
Israel formally acceded to the OECD. Israel's economy also has weathered the
Arab Spring because strong trade ties outside the Middle East have insulated
the economy from spillover effects. Natural gasfields discovered off Israel's
coast during the past two years have brightened Israel''s energy security
outlook. The Leviathan field was one of the world''s largest offshore natural
gas finds this past decade, and production from the Tama field is expected to
meet all of Israel''s natural gas demand beginning mid-2013. In mid-2011,
public protests arose around income inequality and rising housing and commodity
prices. The government formed committees to address some of the grievances but
has maintained that it will not engage in deficit spending to satisfy populist
demands.
|
Source
: CIA |
ROTEM
AMFERT NEGEV LTD.
(Also known as: ROTEM FERTILIZERS
LTD.)
Telephone 972 8 646 53 51; 646 51 18
Fax 972 8 646 55 09
P.O. Box 75, Beer Sheva (8410001)
P.O. Box 187, Yeruham
(8055101)
1 Kroitzer Street,
"Ashlag" (Potash) House
BEER SHEVA 8489414 ISRAEL
A Private Limited Company, incorporated as per file No.
52-003088-3 on the 09.10.1977.
As from 01.08.1989 business activities of AMSTERDAM
FERTILIZERS (AMFERT), a Dutch fertilizers plant, were merged into subject.
On the 09.03.1992, NEGEV PHOSPHATES LTD. was merged
into subject.
NEGEV PHOSPHATES was incorporated as a public limited
company in 1971, taking over business activities of a firm originally
established in 1952.
Subject was originally registered under the name ROTEM
FERTILIZERS LTD., which changed to the present name on the 07.02.1995.
Authorized share capital NIS 58,324,664.00, divided
into -
116,649,327
ordinary shares (111,980,876 shares issued),
1
special share (issued), all of NIS 0.50 each,
of which shares amounting to NIS 55,990,438.50 were
issued.
Subject is fully owned by ISRAEL CHEMICALS LTD. (ICL), a public limited
company whose shares are traded on the Tel Aviv Stock Exchange (TASE).
ICL is controlled (51.8%) by THE ISRAEL CORPORATION LTD. (TIC), also
publicly traded on TASE, controlled (51.5%) by OFER Group, owned chiefly by Idan Ofer (other shareholders in OFER Group are
POTASH CORPORATION OF SASKATCHEWAN (PCS) holds 13.71% of ICL (during
March 2010 invested some NIS 1.5 billion in 2.5% of ICL shares).
The one single special share is held by the State of Israel (given the
fact subject holds rights on Israel national resource).
Nir Gilad, Chairman of ICL,
Stefan Borgas, CEO
of ICL,
Avi Doitchman, CFO of ICL,
Asher Grinbaum,
Moshe Vidman,
Chaim Erez,
Shlomo Maoz,
Amir Makov,
Avisar Paz,
Joseph (Yossi) Lastigzon,
Eli Amit,
Victor Medina,
Dr. Miriam Haran,
Avraham (Baiga) Sochat (former Minister of Finance).
Nissim Adar (also heads ICL FERTILIZERS Division)
Subject is part of ICL FERTILIZERS Division in the ICL Group, which is
the largest division in ICL (57% of sales in 2012, was 58% in 2011).
Producers, exporters and marketers of a varitey of
products based on phosphate rock mined in the Negev Desert, including phosphate
fertilizers, phosphoric acid and specialty fertilizers. Annual phosphate
production amount to 6.5 million tons.
Some 95% of sales are for export, mainly to Europe,
Brazil, India and China.
Eexcavating phosphate from 4 different sites in the
Negev, based on long term licenses from the State of Israel (one valid till
2013 and 3 till 2021 and up), paying royalties in return.
Producing raw materials which are also supplied to
sister division ICL PREFORMANCE PROD
Among customers: SINOCHEM of China.
Among local suppliers: DELTA ELKON, RAW MATERIALS
IMPORT & EXPORT, L Y A HIDRAULICS & PNEUMATIC, MABAT 3D TECH., A.Z.
INDUSTRIES, ELKAYAM INDUSTREIS, SUPERGUM (1983), S.K. MKM ENG., etc.
Also assisted by DORMEX TRADE & INVESTMENTS, which
represents subject in several foreign markets.
Operating from its manufacturing plant (comprises of 8
large facilities) in Mishor Rotem (adderss: M.P. Arava, 86800, near the Dead
Sea; and mines in Arad and in Wadi Zin (Negev Desert)).
Headoffice in Potash House, 1 Kroitzer Street, Beer
Sheva (shared with sister company, DEAD SEA WORKS LTD.). Also operating from
offices in Yeruham in the Negev Desert. ICL headquarters are situated in 23 Osvaldo
Aranya Street, Tel Aviv. There are also
fertilizers plants in Holland, Germany, Belgium and Spain, as well as
phosphate-based feed additives plant in Turkey. Also having offices worldwide.
Having in all (incl. subsidiaries abroad) some 2,000
employees, of which over 1,200 employees in Israel (subject).
There are 12,020 employees in ICL Group (of which 5,500 employees in Israel),
of which 6,014 employees in ICL FERTILIZERS Division.
Financial data is included in the consolidated B/S of parent company,
ISRAEL CHEMICALS LTD., which shows:
US$ (thousands)
ASSETS 31.12.2012 30.06.2013
Current assets:
Cash and cash
equivalents 206,067 238,998
Investments, deposits
and short term loans 142,689 101,137
Customers 1,034,668 1,237,634
Other receivables and
assets 273,490 283,783
Stock 1,430,151 1,369,415
3,087,065 3,230,967
Non-current assets:
Investments and other
non-current assets 425,652 401,972
Fixed assets 3,097,385 3,353,936
Intangible assets 734,809 768,690
4,257,846 4,524,598
7,344,911 7,755,565
======== ========
LIABILITIES
Current liabilities 1,809,198 2,094,564
Non-current liabilities 2,147,449 2,001,065
Equity 3,388,264 3,659,936
7,344,911 7,755,565
======== ========
ICL’s current market value US$ 11,042 million.
Subject is an “Approved Enterprise” and as such enjoys
tax benefits and State incentives.
According to the financial statements of parent ICL, total assets
attributed to the Phosphate segment
(practically subject and subsidiaries in the phosphate
area) as of 31.12.2012 totaled US$ 1,552 million (US$ 1,498 million as
of 31.12.2011).
There are 3 charges for unlimited amounts registered on
the company's assets, in favor of the State of Israel and CRYSTAL PURCHASING
LTD.
Subject pays royalties to the State of Israel as part of the rights
given for mineral production from the Negev Desert – to-date 2% from profits.
Subject’s consolidated sales (including subsidiaries), as given by
subject's CFO, for 2009: US$ 1,500 million (US$ 2,000 million in 2008), of which 95% for export.
Subject ended 2009 with a net profit of US$
119,861,000.
Subject ended 2010 with a net profit of US$ 245.1
million.
Subject ended 2011 with a net profit of US$
316,106,000.
Subject ended 2012 with a net profit of US$ 234,384,000.
Phosphate & Fertilizers sales from ICL FERTILIZERS Div. sales (in principle attributed to subject and
subsidiaries, although from the above data given by subject's CFO we learn that
subject's sales are actually higher) were:
(in US$, Million) 2010 2011 2012 2013-1stH
Sales 1,056.3 1,705.9 1,733.3 977
Gross profit 285.4 502.8 463.7 -
Operating profit 108.6 221.3 162.5 108
ISRAEL CHEMICALS LTD.
Consolidated Statement of Income:
US$
(thousands)
Year
ended 31.12
2010 2011 2012
Sales 5,691,537 7,067,834 6,471,433
Gross profit 2,432,076 3,155,663 2,711,198
Operating income 1,346,127 1,925,965 1,553,632
Income before taxes on
income 1,295,423 1,871,708 1,519,293
Net income 1,028,617 1,523,016 1,301,732
======== ======== ========
ICL consolidated sales for the first 6 months of 2013 were US$ 3,410.5
million (similar to the parallel period in 2012), making a gross profit of US$
1,377 million, an operating profit of US$ 756 million and a net income of US$ 622.3
million.
Main wholly-owned subsidiaries, among many others in Israel and
worldwide:
FERTILIZERS AND CHEMICALS LTD., manufacturers, importers and marketers
of fertilizers and chemicals, mainly for the agriculture sector, e.g. nitrogen
and phosphorus fertilizers, industrial chemicals, water treatment, gases, paint
dyers, solvents, feed additives, etc.
NEGEV STAR LTD.
EDOM MINERALS & DEVELOPMENT LTD.
EUROCHIL HOLDINGS B.V. (ICL FERTILIZERS EUROPE), Holland, marketing arm
in Europe, holds ICL FI POTASH B.V. and many others subsidiaries.
AMSTERDAM FERTILIZERS B.V., Holland, owns ICL FERTILIZERS EUROPE CV,
ROTEM TURKEY, AMSTERDAM FERTILIZERS DEUTSCHLAND OHG (AMFERT GERMANY), ICL
FERTILIZERS DEUTSCHLAND,
EVERRIS INTERNATIONAL B.V., Holland,
P.M. CHEMICALS SRL, Italy,
ICL ASIA LTD.,
ZUARI ROTEM SPECIALTY FERTILIZERS, 50%, India.
ROTEM BKG LLC, USA,
ROTEM DO BRAZIL LTDA, ICL BRAZIL LTDA, both of Brazil,
ICL FERTILIZERS (INDIA) PRIVATE LIMITED, India.
Subject is part of ICL FERTILIZERS Division which includes 4 main
companies (each with subsidiaries), subject being one of the 4, the 3 others
are:
DEAD SEA WORKS LTD., producers, manufacturers, exporters and marketers
of potash and other chemicals from the Dead Sea. Holds 100%, among others, in
ICL IBERIA SCS, GRUPO EMPRESARIAL AGROMEDITERRANO S.A and IBER POTASH S.A.,
both of Spain, CLEAVLAND POTASH LIMITED of the U.K., ASHLEY CHEMICALS (HOLLAND)
B.V.
MIFALEI TOVALA LTD., land
transportation, bulk transportation.
Other companies part of the ICL Group, among many others:
ICL
Industrial
Products (ICL-IP),
DEAD SEA BROMINE COMPANY LTD., part of
ICL Industrial Products (ICL-IP), heading
the DEAD SEA BROMINE GROUP (known as “DSBG”). Mainly via wholly-owned
subsidiary BROMINE COMPOUNDS LTD., operating as manufacturers, exporters and
marketers of bromine compounds and other industrial chemicals based on minerals
extracted from the Dead Sea.
BROMINE COMPOUNDS MARKETING (2002) LTD.,
marketing arm,
Among DSBG other subsidiaries (100% unless otherwise stated):
TETRABROM TECHNOLOGIES LTD.,
CHEMADA FINE CHEMICALS LTD., 26%,
TAMI IMI INSTITUTE FOR RESEARCH & DEVELOPMENT LTD.,
DEAD SEA PRICLASE FUSED PROD
ICL-IP AMERICA INC., USA, owns HY YIELD BROMINE, 80%, USA,
ICL-IP JAPAN LTD., Japan,
LANDCAM LIMITED, South Africa,
BROMINE & CHEMICALS LIMITED, UK,
EUROCLEARON B.V., the Netherlands, owns CLEARON CORP., USA,
ICL-IP EUROPE B.V., the Netherlands, holds several subsidiaries,
including BROMOCHEMIE HOLDINGS B.V., ICL IP TERNEUZEN B.V., SINOBROM (75%,
China), LIANYONGANG DEAD SEA BROMINE COMPOUNDS LTD (60%, China), BROMISA
INDUSTRIAL E COMERCIAL LTDA (Brazil), etc.,
ROTEM AMFERT NEGEV B.V., Holland.
ICL Performance
Products:
ICL PERFORMANCE PROD
B.K. GIULINI GmbH, a subsidiary in Germany,
BKG PURIPHOS B.V.,
PEKAFERT B.V., holds EUROCIL LUXEMBOURG,
ASTARIS INC. of the U.S.A. and Brazil,
ICL NORTH AMERICA INC, USA.
ICL Metallurgy, headed by DEAD SEA MAGNESIUM LTD., producers,
manufacturers, exporters and marketers of magnesium and related products,
producing magnesium from the Dead Sea.
Others:
I.D.E. TECHNOLOGIES LTD., 50%, desalination facilities and water
treatment,
ICL FINANCE B.V., The Netherlands, ICL FINANCE INC., USA, ICL
FINANCE & ISSUING LTD., ICL FINE
CHEMICALS LTD., TWINCAP FOERSAEKRINGS AB (Sweden), and many others, including
companies in ICL Group and ISRAEL CORP. concern.
Bank Leumi Le’Israel Ltd., Tel Aviv Central Branch (No.
800), Tel Aviv.
Bank Hapoalim Ltd., Beer Sheva Branch (No. 631), Beer Sheva.
There are several lawsuits against subject, mainly due to environmental
issues. None of the lawsuits seem to be significant. ICL has been investing
tens of NIS millions in recent years in environmental protection ends.
Apart from that nothing unfavorable learned (there are
several issues specified below with negative effect on ICL and subject).
Despite our efforts, we were unable to reach
subject's CFO, as he was always busy. We left messages, which remain
unanswered.
ICL is a multi-national concern, among the
world's leading suppliers of minerals and one of the largest industrial
concerns in Israel. ICL is ranked the world's 6th largest potash manufacturer (9%
of market share in 2011), the world's largest
producer of PK fertilizers (compound of potash and phosphate fertilizers), and leading producer
of specialty phosphates based on purified phosphoric acid. ICL subsidiary DSBG considered
of the world’s leading company in the bromine market, with estimated production
of 40% of the total elementary bromine production in the world, leading
bromine-based flame retardant products market.
ISRAEL CORP. (TIC), current market value US$ 4,056.4 million, part of OFER Group, is Israel’s largest holding company, one the
largest and most influential groups in the Israeli market, operating worldwide
also in the fields of energy, shipping, high tech & electronics and real
estate.
Canadian PCS, which holds some 14% in ICL, is the world’s largest potash
producer (20% market share).
In October 2012 TIC announced on negotiations with PCS on a merger deal,
where PCS will take over full ownership of ICL in a shares swap deal (TIC will become
a shareholder in PCS). PCS is publicly traded on NYSE and Toronto (TSX: POT,
NYSE: POT) with market value of US$ 28.3 billion. Under the circumstances, TIC
would have become the major shareholder in PCS with some 20% stake. Such a
transaction requires the State of Israel authorization, which holds a golden
share in ICL that acquires it veto rights, as ICL has concession to Israel's
natural resources (potash, phosphates, bromine). After the Minister of Finance
expressed his resistance to such transaction, in April PCS announced it
withdraws its intention to pursuit with the merger at this time.
Subject and ICL Group recovered in 2010 and especially in 2011 from the
depression in their business mainly during 2009, due to the global economic
crisis, which drove demand for fertilizers and potash down and prices plunged
(mainly of fertilizers, as potash prices were more stable). The Group adjusted
production levels and took streamlining measures, and with demands rising again
ICL returned to its impressive growth path in the years that preceded the
crisis following the unprecedented demand for such in recent years.
ICL has suffered a major blow in end of July 2013 with the announcement
of URALKALI on its intention to cease selling potash via the marketing company
BCP (means the dismantling of the Russian potash cartel which may lead to the
drop of potash prices in world markets in the short term and loss of revenues).
Consequently, ICL market value dropped significantly, though recovered to some
extent recently following rumors on renewal of the Cartel.
Subject is ISO 9001:2000 certified.
In December 2010 the Israeli Parliament voted to cancel ICL special tax
benefits (hundreds NIS millions), as part of a revision concerning royalties
from State resources, including phosphate (ICL has been enjoying both from low
royalties rate and tax benefits), with view of elevating the fees collected by
the State. The State claimed that ICL also paid less than it had to and has to
compensate the State. After long mediation process, royalties for phosphate
recently rose, yet Government officials claim the fee is still too low and
consider much higher rate.
Subject has been operating to obtain permits to develop
a large field in the Negev Desert which contains large reserves of the
phosphate rock. As the land is situated only few km from the town of Arad (and
not far from one of subject’s plants) there is a strong resistance from
citizens of Arad, and the matter has been under revision by Government
authorities. Subject received excavation permit for 'Brir Field' (part of a
larger Zohar Field), with large with reserves potential estimated at least of
US$ 25 billion (250-500 tons).
In view of the recent public debate on the above royalties and permits
issues, and uncertainties, ICL launched a strategic plan to become less
dependent on Israel's natural resources and seek global resources. In that
aspect, it signed in mid 2013 a memorandum for cooperation with DUC GIANG in
Vietnam for erection and operation of a phosphate
excavation project.
In 1982 ICL acquired Dutch AMSTERDAM FERTILIZERS
(AMFERT) and its fertilizers plant. In 1987, ICL 3 German fertilizers plants
were merged into AMFERT, after they experiences grave losses. After the merger
of AMFERT and NEGEV PHOSPHATES in 1992, subject began operating under its
current style.
In 1996, ICL German subsidiary GIULINI acquired
BK LADENBURG from HOECHST for US$ 60 million.
In september 2005, ICL acquired ASTARTIS, producers of
phsphate-based products of the USA and Brazil, for a sum of US$ 255 million.
In August 2007 ICL announced on a new joint venture in India with a
local company ZUARI (of BIRLA CHEMICALS Group), designed to penetrate the
dissolvable fertilizers market in India. The venture is part of subject's ICL
FERTILIZERS Div. and expected to generate annual income of US$ 20 million. The
venture comprises of a manufacturing plant in India and marketing activity. In
August 2011 ICL announced on the expansion of its manufacturing capacity in
India, with the erection of 2 plants with cooperation of ZUARI.
In August 2007 ICL acquired American SUPRESTA, manufacturers of
phosphorus products for fire safety and leading company in its field in the
world, for US$ 352 million. In late 2009 ICL acquired further 6 foreign
companies in the Performance Products field for total of US$ 40 million.
ICL Group's plants started to benefit from the shift of the Group's use
in natural gas as energy source (replacing some of the ISRAEL ELECTRICITY CORP.
conventional electricity power) from the end of 2008. ICL expected to save US$
100 million per year due to the move. ICL signed agreements with TETHYS SEA and
with EMG, to supply natural gas. In parallel, in July 2012 ICL reported on
investing US$ 320 million in the erection of a new 250mW power station in Sodom
site. The project, expected to end by 2015 2nd half, is designed to
meet the forecasted growth in demand for ICL potash and bromine production
capacity, while saving electricity costs.
In September 2009 ICL raised NIS 898 million in bonds issuance
to the public.
On the 04.12.2011 ICL signed an agreement with 7 international banks to
receive a line of credit of US$ 650 million.
In June 2010 it was reported that ICL signed transportation contracts
with ISRAEL RAILWAYS for cargo from the Dead Sea and Negev Desert until
In June 2010 it was reported that in view of the global economic climate
and credit suffocation, ICL started to use the credit insurance facilities of
State-owned ASHRA – THE ISRAEL EXPORT INSURANCE CORP. LTD. (jointly with
private credit insurance company ICIC) for subject’s (and sister company DEAD
SEA WORKS) short-term deals with Brazil in value of tens of US$ millions.
In February 2011 ICL completed the acquisition of EVERRIS (formerly SCOTTS
GLOBAL PRO (a division in SCOTTS
In its quest to expand in the specialized fertilizers field, in April
2011 ICL announced on the acquisition of Spain's largest actor in this area,
FUENTES MENDEA S.A. for €95 million.
Other acquisitions designed to expand in specialty fertilizers were of
the activities of American HALOX (which is a global leader in phsphate-based products for the colors and
coatings industry in the building field) and in October 2011 purchasing 50% (on
top of 50% already held) of Belgian fertilizer components maker NUTRISI
HOLDINGS, which holds 50% in NU3, the world's largest manufacturer of soluble
NPK.
Good for trade engagements.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.63.45 |
|
|
1 |
Rs.101.17 |
|
Euro |
1 |
Rs.85.55 |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.