MIRA INFORM REPORT

 

 

Report Date :

18.07.2014

 

IDENTIFICATION DETAILS

 

Name :

SOJITZ CORPORATION

 

 

Registered Office :

2-1-1 Uchisaiwaicho Chiyodaku Tokyo 100-8691

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2014 (consolidated)

 

 

Date of Incorporation :

December 1982

 

 

Com. Reg. No.:

(Tokyo-Minatoku) 049977

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)      

 

 

Line of Business :

Subject is a general trading house:

 

Subject operates through following divisions :-

 

Machinery Division

Automotive Unit, Environment & Infrastructure Unit, IT Business Unit, Marine & Aerospace Unit

 

Energy & Metals Division

Energy & Nuclear Unit, Coal & Non-ferrous Metals Unit, Ferrous Metals & Steel Products Unit

 

Chemicals & Functional Materials Division

Chemicals Unit & Functional Materials Unit

 

Lifestyle Business Division

Foods Resources Unit, General Commodities & Textile Unit, Forest Products & Real Estate Development Unit

 

 

No. of Employees

15,915

 

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 :

Good

 

 

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 31, 2014

 

Country Name

Previous Rating

(31.12.2013)

Current Rating

(31.03.2014)

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

 

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

E-Mail address:            info@sojitz.com

 

 

ACTIVITIES

 

Subject is a general trading house:

 

Subject operates through following divisions:-

 

Machinery Division

Automotive Unit, Environment & Infrastructure Unit, IT Business Unit, Marine & Aerospace Unit

 

Energy & Metals Division

Energy & Nuclear Unit, Coal & Non-ferrous Metals Unit, Ferrous Metals & Steel Products Unit

 

Chemicals & Functional Materials Division

Chemicals Unit & Functional Materials Unit

 

Lifestyle Business Division

Foods Resources Unit, General Commodities & Textile Unit, Forest Products & Real Estate Development Unit

 

 

BRANCHES

 

7 domestic, 87 overseas

(Subsidiaries/affiliates): 117 domestic, 322 overseas

 

 

CHIEF EXECS

 

YOJI SATO, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY    

 

FINANCES        FAIR                                         A/SALES          Yen 4,056,577 M

PAYMENTS      no complaints                      CAPITAL           Yen 160,339 M

TREND STEADY                                   WORTH            Yen 459,853 M

STARTED         2003                                         EMPLOYES      15,915

 

                       

COMMENT

 

GENERAL TRADING HOUSE. 

 

FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

 

 

Business

Terms Ending

Annual Sales*

R.Profit*

N.Profit*

S.Growth

Net Worth*

   Results:

31/03/2011

4,014,639

45,316

15,981

(%)

346,286

(Consolidated)

31/03/2012

4,494,237

62,228

-3,649

11.95

329,962

 

31/03/2013

3,934,456

28,052

13,448

-12.46

411,298

 

31/03/2014

4,046,577

44,033

27,250

2.85

492,959

 

31/03/2015

4,230,000

55,000

33,000

4.53

..

                          Unit: In Million Yen

Forecast figures for the 31/03/2015 fiscal term.

 

 

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 is intensifying Brazil’s cereal crop cargo pickup/export business for Asia.  It is investing Yen 16 billion in local major firm to expand commercial distribution channels.  The number of electricity IPP projects has reached 10 in total, with 3 IPP projects became operational in 2013. 

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2014 fiscal term amounted to Yen 4,046,577 million, a 2.8% up from Yen 3,934,456 million in the previous term.  Earnings were led by brisk automobile sales in Russia and stronger demand for chemicals and fertilizers in Southeast Asia.  The recurring profit was posted at Yen 44,033 million and the net profit at Yen 27,250 million respectively, compared with Yen 28,052 million recurring profit and Yen 13,448 million net profit, respectively, a year ago

 

For the current term ending Mar 2015 the recurring profit is projected at Yen 55,000 million and the net profit at Yen 33,000 million, respectively, on a 4.5% rise in turnover, to Yen 4,230,000 million.  Earnings & operating profits will expand, led by sales growth of automobiles and foodstuff. 

 

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:         2,500 million shares

Issued:                1,251,499,501 shares

Sum:                   Yen 160,339 million

           

Major shareholders (%): Japan Trustee Services T (4.5), Master Trust Bank of Japan T (2.8), BBH-Boston GMO Int’l Intrinsic V (1.5), State Street Bank & Trust 505225 (1.3), State Street Bank West Treaty (1.1), Japan Trustee Services T6 (1.1), Japan Trusty Services T5 (1.0), Japan Trustee Services T3 (1.0), Japan Trustee Services T2 (1.0), Japan Trustee Services T1 (1.0); foreign owners (32.7)

 

No. of shareholders: 162,899

 

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

 

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

 

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

 

Related companies: Sojitz Marine & Engineering, Sojitz Building Materials Corp, other (Tot 117 domestic &322 overseas)

 

 

OPERATION

 

Activities: A general trading house:

 

(Sales breakdown by Divisions):

 

Machinery Division (24%): Automotive Unit, Environment & Infrastructure Unit, IT Business Unit, Marine & Aerospace Unit;

 

Energy & Metals Division (19%): Energy & Nuclear Unit, Coal & Non-ferrous Metals Unit, Ferrous Metals & Steel Products Unit;

 

Chemicals & Functional Materials Division (16%): Chemicals Unit, Functional Materials Unit;

 

Lifestyle Business Division (38%): Foods Resources Unit, General Commodities & Textile Unit, Forest Products & Real Estate Development Unit;

 

Others (2%)

 

Overseas trading (35%)

 

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 Bank (H/O)

Relations: Satisfactory

 

FINANCIALS

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

 

　

　

Terms Ending:

31/03/2014

31/03/2013

INCOME STATEMENT

 

 

 

  Annual Sales

　

4,046,577

3,934,456

 

  Cost of Sales

3,848,356

3,747,211

 

      GROSS PROFIT

198,221

187,245

 

  Selling & Adm Costs

174,527

161,752

 

      OPERATING PROFIT

23,694

25,493

 

  Non-Operating P/L

20,339

2,559

 

      RECURRING PROFIT

44,033

28,052

　

      NET PROFIT

27,250

13,448

BALANCE SHEET

 

 

 

 

  Cash

　

120,658

424,371

 

  Receivables

 

524,826

508,690

 

  Inventory

 

301,979

297,389

 

  Securities, Marketable

　

　

 

  Other Current Assets

374,361

60,728

 

      TOTAL CURRENT ASSETS

1,321,824

1,291,178

 

  Property & Equipment

213,934

231,840

 

  Intangibles

 

107,222

108,932

 

  Investments, Other Fixed Assets

577,256

518,100

 

      TOTAL ASSETS

2,220,236

2,150,050

 

  Payables

 

514,585

515,989

 

  Short-Term Bank Loans

227,216

258,375

 

　

 

　

　

 

  Other Current Liabs

70,049

74,562

 

      TOTAL CURRENT LIABS

811,850

848,926

 

  Debentures

 

　

　

 

  Long-Term Bank Loans

838,060

818,632

 

  Reserve for Retirement Allw

16,917

16,158

 

  Other Debts

　

60,450

55,035

 

      TOTAL LIABILITIES

1,727,277

1,738,751

 

      MINORITY INTERESTS

 

 

 

Common stock

160,339

160,339

 

Additional paid-in capital

10,463

9,816

 

Retained earnings

33,538

13,053

 

Evaluation p/l on investments/securities

　

　

 

Others

 

288,776

228,238

 

Treasury stock, at cost

(157)

(148)

 

      TOTAL S/HOLDERS` EQUITY

492,959

411,298

　

      TOTAL EQUITIES

2,220,236

2,150,050

CONSOLIDATED CASH FLOWS

 

 

 

 

Terms ending:

31/03/2014

31/03/2013

 

Cash Flows from Operating Activities

　

46,997

55,124

 

Cash Flows from Investment Activities

-24,469

-11,652

 

Cash Flows from Financing Activities

-30,931

-56,177

　

Cash, Bank Deposits at the Term End

　

620,658

424,371

ANALYTICAL RATIOS            Terms ending:

31/03/2014

31/03/2013

 

 

Net Worth (S/Holders' Equity)

492,959

411,298

 

 

Current Ratio (%)

162.82

152.10

 

 

Net Worth Ratio (%)

22.20

19.13

 

 

Recurring Profit Ratio (%)

1.09

0.71

 

 

Net Profit Ratio (%)

0.67

0.34

 

 

Return On Equity (%)

5.53

3.27

 

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.60.14

UK Pound

1

Rs.103.00

Euro

1

Rs.81.33

                

INFORMATION DETAILS

 

Analysis Done by :

SUB

 

 

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.