MIRA INFORM REPORT

 

 

Report Date :

26.12.2014

 

IDENTIFICATION DETAILS

 

Name :

LANKEM CEYLON PLC

 

 

Registered Office :

# 98, Sri Sangaraja Mawatha,Colombo 10

 

 

Country :

Sri Lanka

 

 

Financials (as on) :

31.03.2014

 

 

Date of Incorporation :

15.09.1964

 

 

Com. Reg. No.:

PQ 128

 

 

Legal Form :

Public Limited Liability Company listed in the Colombo Stock exchange (In Operation)

 

 

Line of Business :

Importers & Distributors of Chemicals (Agro and Industrial Chemicals), Consumer Products, Paints, Plantation, and Constructions and Hotels

 

 

No. of Employee :

Approximately 28,000

 

 

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 – September 30, 2014

 

Country Name

Previous Rating

(30.06.2014)

Current Rating

(30.09.2014)

Sri Lanka

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

SRI LANKA ECONOMIC OVERVIEW

 

Sri Lanka continues to experience strong economic growth following the end of the 26-year conflict with the Liberation Tigers of Tamil Eelam. The government has been pursuing large-scale reconstruction and development projects in its efforts to spur growth in war-torn and disadvantaged areas, develop small and medium enterprises and increase agricultural productivity. The government's high debt payments and bloated civil service have contributed to historically high budget deficits, but fiscal consolidation efforts and strong GDP growth in recent years have helped bring down the government's fiscal deficit. However, low tax revenues are a major concern. The 2008-09 global financial crisis and recession exposed Sri Lanka's economic vulnerabilities and nearly caused a balance of payments crisis. Agriculture slowed due to a drought and weak global demand affected exports and trade. In early 2012, Sri Lanka floated the rupee, resulting in a sharp depreciation, and took steps to curb imports. A large trade deficit remains a concern, but strong remittances from Sri Lankan workers abroad help offset the trade deficit. Government debt of about 80% of GDP remains among the highest in emerging markets.

 

Source : CIA

GENERAL

 

- Basic information at a glance

       

a.

Name of Subject of Inquiry

:

Lankem Ceylon PLC

b.

Legal Form  & Status

 

:

 

Public Limited Liability Company listed in the Colombo Stock exchange (In Operation)

c.

Chairman

:

A. Rajaratnam

d.

Primary Line Of  Business

:

Importers & Distributors of Chemicals (Agro and Industrial Chemicals), Consumer Products, Paints, Plantation, and Constructions and Hotels

e.

Place Of Business

:

 

# 297A 1/1, Union Place,

Colombo – 2,

Sri Lanka.

 

Tel. No: (00 94 11) 247 8800 / 776 6000 / 556 6000

Fax No: (00 94 11) 244 8534

 

E-mail: info@lankem.lk

f.

Number of Employees

:

  Approximately 28,000

 

 

COMPANY DETAILS 

 

- Registration and Shareholder Details

 

a.

Registration No

:

PQ 128

b.

Date of Registration

:

15th September 1964

c.

Registered Office

:

# 98, Sri Sangaraja Mawatha,Colombo 10, Sri Lanka

d.

Board of Directors

As At

31st March 2014

:

A.    Rajaratnam 

Chairman

S. D. R. Arudpragasam

Deputy

Chairman

Anushman Rajaratnam

Managing Director

D. L. Vitharana

Chief Operating Officer

R. N. Bopearatchy

Director

A. Hettiarachchi    

Director

A. C. S. Jayaranjan 

Director

N. H. B. S. Perera  

Director

K. P. David   

Director

A. R. Peiris

Director

R. T. Weerasinghe

Director

J. D. Gomes

Director

R. Seevaratnam

Director

e.

Issued Share Capital

 

Rs. 536,218,000.00

Number of Shares

:

24,000,000

f.

Nominal Value of Share

:

Not applicable/declared vide Companies Act #7 of 2007

 

 

COMPANY DETAILS 

 

- Registration and Shareholder Details

 

g.

Major Share Holders

As At

31st March 2014

(Total Number of Shares Holders 2,340)

:

Major  Share Holders

No. Of

Shares

E. B. Creasy & Company PLC

10,974,635

The Colombo Fort Land & Building Plc

7,517,500

Associated Electrical Corporation Ltd

620,885

Darley Butler & Company Ltd   

536,614

Sri Lanka Insurance Corporation Ltd-General Fund

516,500

Colombo Fort Investments PLC

422,957

Colombo Investment Trust PLC

170,719

Waldock Mackenzie Ltd / Hi-Line Trading (Pvt) Ltd.

107,885

h.

Auditors

:

KPMG Ford Rhodes Thornton & Company

i.

Company Secretaries

:

Corparate Managers & Secretaries Ltd

j..

Lawyers

:

Julius & Creasy

k.

Bankers

:

Commercial Bank of Ceylon ltd, Bank of Ceylon

PABC Bank Ltd, Bank of Ceylon, Peoples Bank

Seylan Bank Ltd, Union Bank of Colombo Ltd, Indian Bank

 

 

FINANCIAL DETAILS

 

- Most recent available Financial Information

 

New Picture           

 

 

 

New Picture (1)

 

 

CURRENT INVESTIGATION

 

·         History.

 

New Picture

 

The subject company Lankem Ceylon PLC, is a public limited liability company (Listed) incorporated on 15th September 1964 under registration number PQ 128

 

 With the introduction of the new company’s Act No. 7 of 2007 on 3rd of May 2007, the abbreviation of the suffix in the company’s name has been deemed change from ‘LTD’ to ‘PLC’. Accordingly Lankem Ceylon Ltd is Lankem Ceylon PLC from the date

The Subject Company, Lankem Ceylon Ltd, was incorporated in 1964 as a private limited liability company, and was converted into a public quoted company in 1970 with a broad base of shareholders. E.B. Creasy & Co. Ltd

 

Location.

 

The Subject Company is located at client # 297A 1/1, Union Place, Colombo – 2, Sri Lanka.

 

Operational Details.

 

General

 

The subject company primary line of business is Importers & Distributors of Chemicals (Agro and Industrial Chemicals), Consumer Products, Paints, Plantation, and Constructions and Hotels

 

Lankem Ceylon PLC is a Sri Lanka-based company. The principal activity of the Company is manufacturing of chemicals, paints and consumer products. The Company operates with seven business segments: chemicals, which includes manufacturing, distribution and service activities relating to chemicals; consumer, which includes manufacturing, selling and distribution of consumer products; hardware, which includes manufacturing, selling and distribution of hardware products; construction, which includes road construction, waterproofing and industrial flooring; hotels, which include owning and operation of resort hotels; plantations, which include cultivation and processing of tea and rubber, and agriculture, which includes farming and dairying.

 

 

Products

 

Chemicals (Agro and Industrial Chemicals), Consumer Products, Paints, Plantation, and Constructions and Hotels

 

Subsidiary Companies

 

Lankem Paints Ltd

Lankem Consumer Products Ltd

Lankem Chemicals Ltd

Lankem Agrochemicals Ltd

Sun Agro Life Science Ltd

Lankem Development PLC

Lankem Plantation Holdings Ltd

Lankem Tea & Rubber Plantation (Pvt) Ltd

Kotagala Plantation PLC

Agarapathana Plantation Ltd

Lankem Plantation Services Ltd

Sigiriya Village Hotels PLC

Maravila Resorts PLC

o    Colombo Forts Hotels Ltd

o    Beruwala Resorts Ltd

o    York Hotels (Kandy) Ltd

o    Lankem Exports (Pvt) Ltd

o    Associated Farms Ltd

o    Lankem Technology Services Ltd

o    Nature’s Link Ltd

 

 

No of Employees

 

Approximately 28,000

 

Trade references

 

The subject company did not provide any trade references

 

Credit Recommendations

 

No computerised data bases exist to make checks whether the partners or the company has any legal action or lawsuit initiated against any of them but informal (but not in-depth) checks do not indicate any such cases in the public knowledge.

 

 

INFORMATION PARTED

 

Name :

Ms. Achini

Designation :

Company Secretary

Contact No.:

9411-2478800

Date :

22.12.2014

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.63.46

UK Pound

1

Rs.98.51

Euro

1

Rs.77.31

 

 

INFORMATION DETAILS

 

Information Gathered by :

PRT

 

 

Analysis Done by :

RAS

 

 

Report Prepared by :

ANK

 

 

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.