MIRA INFORM REPORT

 

 

Report Date :

14.04.2014

 

IDENTIFICATION DETAILS

 

Name :

SOJITZ CORPORATION

 

 

Registered Office :

2-1-1 Uchisaiwaicho Chiyodaku Tokyo 100-8691

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2013

 

 

Date of Incorporation :

December, 1982

 

 

Com. Reg. No.:

(Tokyo-Minatoku) 049977

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Importer, Exporter & Wholesaler of Machinery, Energy, Metals & Chemicals

 

 

No. of Employees :

16,614

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

With Financials

 

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 – december 01, 2013

 

Country Name

Previous Rating

(30.09.2013)

Current Rating

(01.12.2013)

Japan

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

 

 

JAPAN ECONOMIC OVERVIEW

 

In the years following World War II, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (1% of GDP) helped Japan develop a technologically advanced economy. Two notable characteristics of the post-war economy were the close interlocking structures of manufacturers, suppliers, and distributors, known as keiretsu, and the guarantee of lifetime employment for a substantial portion of the urban labor force. Both features are now eroding under the dual pressures of global competition and domestic demographic change. Japan's industrial sector is heavily dependent on imported raw materials and fuels. A small agricultural sector is highly subsidized and protected, with crop yields among the highest in the world. While self-sufficient in rice production, Japan imports about 60% of its food on a caloric basis. For three decades, overall real economic growth had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s, and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the after effects of inefficient investment and an asset price bubble in the late 1980s that required a protracted period of time for firms to reduce excess debt, capital, and labor. Modest economic growth continued after 2000, but the economy has fallen into recession three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan into recession. Government stimulus spending helped the economy recover in late 2009 and 2010, but the economy contracted again in 2011 as the massive 9.0 magnitude earthquake and the ensuing tsunami in March disrupted manufacturing. The economy has largely recovered in the two years since the disaster, but reconstruction in the Tohoku region has been uneven. Prime Minister Shinzo ABE has declared the economy his government's top priority; he has overturned his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus, monetary easing, and structural reform. Japan joined the Trans Pacific Partnership negotiations in 2013, a pact that would open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses. Measured on a purchasing power parity (PPP) basis that adjusts for price differences, Japan in 2013 stood as the fourth-largest economy in the world after second-place China, which surpassed Japan in 2001, and third-place India, which edged out Japan in 2012. The new government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which is exceeding 230% of GDP. To help raise government revenue and reduce public debt, Japan decided in 2013 to gradually increase the consumption tax to a total of 10% by the year 2015. Japan is making progress on ending deflation due to a weaker yen and higher energy costs, but reliance on exports to drive growth and an aging, shrinking population pose other major long-term challenges for the economy.

Source : CIA

 

 

 

 

 

COMPANY NAME

 

SOJITZ CORPORATION

 

 

REGD NAME

 

Sojitz KK

 

 

MAIN OFFICE

 

2-1-1 Uchisaiwaicho Chiyodaku Tokyo 100-8691 JAPAN

Tel: 03-6871-5000     Fax: 03-6871-2430

 

*.. Moved to the caption address in 2012 from the one as given

 

 

URL:                 http://www.sojitz.com/

E-Mail address:            info@sojitz.com

 

 

ACTIVITIES

 

Importer, Exporter & Wholesaler of Machinery, Energy, Metals & Chemicals

 

 

BRANCHES

 

7 domestic, 89 overseas

 (Subsidiaries/affiliates): 128 domestic, 342 overseas

 

 

CHIEF EXECS

 

YOJI SATO, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 3,955,907 M

PAYMENTS      NO COMPLAINTS          CAPITAL           Yen 160,339 M

TREND             STEADY                       WORTH            Yen 382,537 M

STARTED         2003                             EMPLOYES      16,614

                       

 

COMMENT    

 

GENERAL TRADING HOUSE. 

FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

           

 

                             Unit: In Million Yen

Forecast figures for the 31/03/2014 fiscal term. (Unit in Million Yen)

 

 

HIGHLIGHTS

 

The subject company was established in Apr 2003 by forming a joint holding company, named Nissho Iwai-Nichimen Holdings Company, by the then Nissho Iwai Co and Nichimen Co, and subsequently in Apr 2004 the two merged into Sojitz Corp as captioned.  The holding company, at the same time, renamed Sojitz Holdings Corporation.  The merger was formed in order to restructure the two firms through supports from financial institutions including the then UFJ Bank (now MUFG), the main bank for the two firms.  On 01/Oct/2005, in order to further streamline the Group’s management framework, Sojitz Holdings merged with its principal operating arm and wholly owned subsidiary, Sojitz Corporation.  The company’s name was then changed to Sojitz Corporation.  This is a general trading house succeeding the business rights & operations of the said two firms, excluding liquidation or separation of unprofitable divisions & operations.  This is the sixth-ranked general trading house.  Major handling items are machinery, energy & resources, which former Nissho Iwai Corp was the stronger, and textiles which the former Nichimen Corp was stronger.  Highly competitive in fields of aircraft, lumber and urban development.  The company will reduce automobile production in anticipation of European automakers’ low price offensive sales efforts in Russia and possible currency devaluation in Venezuela.  Automobile production cut might be possibly prolonged.  The company is planning to spend Yen 60 billion on automobile-related capital spending in Mar 2013. 

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2013 fiscal term amounted to Yen 3,955,907 million, a 12.0% down from Yen 4,494,237 million in the previous term.  The decline is largely as a result of lower prices and reduced demand for commodities the firm handles.  Another factor is that earnings in the 2011 fiscal term (the fiscal year ended Mar/2012) included 15 months of major overseas’ subsidiaries as a result of change their fiscal year-end from December to March.  The recurring profit was posted at Yen 34,478 million and the net profit at Yen 14,263 million respectively, compared with Yen 82,228 million recurring profit and Yen 3,469 million net losses, respectively, a year ago

 

For the current term ending Mar 2014 the recurring profit is projected at Yen 45,000 million and the net profit at Yen 25,000 million, respectively, on an 8% rise in turnover, to Yen 4,280,000 million.  Earnings will be led by overseas fertilizer sales and industrial park allotment sales.  Elimination of resource-related temporary deficit will show effects.

 

The financial situation is considered FAIR and good for ORDINARY business engagements. 

 

 

REGISTRATION

           

Date Registered:           Dec 1982

Regd No.:                                 (Tokyo-Minatoku) 049977

Legal Status:                 Limited Company (Kabushiki Kaisha)

Authorized:                  1,349 million shares

Issued:                         1,251,091,013 shares

Sum:                            Yen 160,339 million

           

Major shareholders (%): Japan Trustee Services T (5.7), Master Trust Bank of Japan T (3.1), State Street Bank & Trust 505225 (1.4), SSBT Omnibus Acct Treaty (1.3), Mellon Bank Mellon Omnibus US P (1.2), State Street Bank West (1.1), Japan Trustee Services T9 (0.9), Nomura Sing C Segregated FJ1309 (0.9); foreign owners (26.0)

 

No. of shareholders: 186,273

 

Listed on the S/Exchange (s) of: Tokyo

 

Managements: Yutaka Kase, ch; Takashi Hara, v ch; Yoji Sato, pres; Shigeki Dantani, v pres; Joji Suzuki, v pres; Shinichi Taniguchi, v pres; Yoshio Mogi, s/mgn dir; Tetsuya Kaneda, mgn dir; Masahiro Komiyama, mgn dir; Shinichi Teranishi, mgn dir; Satoshi Mizui, mgn dir

 

Nothing detrimental is known as to the commercial morality of executives.

 

 

OPERATION

 

Activities: A general trading house:

 

(Sales breakdown by Divisions):

 

Machinery Division (23%): Automotive Unit, Environment & Infrastructure Unit, IT Business Unit, Marine & Aerospace Unit;

 

Energy & Metals Division (23%): Energy & Nuclear Unit, Coal & Non-ferrous Metals Unit, Ferrous Metals & Steel Products Unit;

 

Chemicals & Functional Materials Division (15%): Chemicals Unit, Functional Materials Unit;

 

Lifestyle Business Division (37%): Foods Resources Unit, General Commodities & Textile Unit, Forest Products & Real Estate Development Unit;

 

Others (1%)

 

Overseas trading (34%)

           

Clients: [Mfrs, wholesalers] Kobe Steel, NM Life, First Retailing, Uto Kosan, Zao Severstal, Varig S.A., Auto-Isuzu PT Indofood Sukses Makmur TBK, MMC Automotriz SA, other

            No. of accounts: 2,000

            Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] Hitachi Zosen, Hitachi Ltd, Toyo Rubber, Yamazaki

Nabisco, Sun Building Materials Corp, Sumitomo Metal Mining, Fuji Electric Systems, Sojitz Asia, other.

 

Payment record: No Complaints

 

Location: Business area in Tokyo.  Office premises at the caption address are leased and maintained satisfactorily.

 

Bank References:

MUFG (Tokyo)

Mizuho Corporate Bank (H/O)

Relations: Satisfactory

 

 

FINANCIALS

 

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

　

　

Terms Ending:

31/03/2013

31/03/2012

INCOME STATEMENT

  Annual Sales

　

3,955,907

4,494,237

  Cost of Sales

3,763,842

4,262,671

      GROSS PROFIT

192,064

231,566

  Selling & Adm Costs

158,759

167,044

      OPERATING PROFIT

33,305

64,522

  Non-Operating P/L

1,173

-2,294

      RECURRING PROFIT

34,478

62,228

　

      NET PROFIT

14,263

-3,649

BALANCE SHEET

  Cash

　

433,584

442,706

  Receivables

456,455

490,708

  Inventory

292,105

270,645

  Securities, Marketable

100

1,297

  Other Current Assets

82,027

92,795

      TOTAL CURRENT ASSETS

1,264,271

1,298,151

  Property & Equipment

228,332

233,260

  Intangibles

126,114

124,497

  Investments, Other Fixed Assets

467,693

464,688

      TOTAL ASSETS

2,086,410

2,120,596

  Payables

436,696

461,799

  Short-Term Bank Loans

242,267

282,524

　

　

　

  Other Current Liabs

180,047

203,099

      TOTAL CURRENT LIABS

859,010

947,422

  Debentures

60,000

80,000

  Long-Term Bank Loans

715,478

691,018

  Reserve for Retirement Allw

14,998

14,232

  Other Debts

　

54,386

57,453

      TOTAL LIABILITIES

1,703,872

1,790,125

      MINORITY INTERESTS

Common stock

160,339

160,339

Additional paid-in capital

152,160

152,160

Retained earnings

158,488

151,706

Evaluation p/l on investments/securities

13,710

7,626

Others

(101,981)

(141,181)

Treasury stock, at cost

(179)

(179)

      TOTAL S/HOLDERS` EQUITY

382,537

330,471

　

      TOTAL EQUITIES

2,086,410

2,120,596

CONSOLIDATED CASH FLOWS

Terms ending:

31/03/2013

31/03/2012

Cash Flows from Operating Activities

　

51,524

91,600

Cash Flows from Investment Activities

-13,580

-42,287

Cash Flows from Financing Activities

-52,737

-36,376

　

Cash, Bank Deposits at the Term End

　

424,371

427,274

ANALYTICAL RATIOS            Terms ending:

31/03/2013

31/03/2012

Net Worth (S/Holders' Equity)

382,537

330,471

Current Ratio (%)

147.18

137.02

Net Worth Ratio (%)

18.33

15.58

Recurring Profit Ratio (%)

0.87

1.38

Net Profit Ratio (%)

0.36

-0.08

Return On Equity (%)

3.73

-1.10

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.60.27

UK Pound

1

Rs.101.10

Euro

1

Rs.83.74

 

INFORMATION DETAILS

 

Analysis Done by :

DIV

 

 

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%)

 

 

 

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.