MIRA INFORM REPORT
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Report Date : |
06.06.2014 |
IDENTIFICATION DETAILS
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Name : |
HUZHOU SONGHUA RUBBER AND PLASTIC CO., LTD. |
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Registered Office : |
No. 58, Chang’an Street, Wukang Town, Deqing County, Huzhou, Zhejiang Province, 313299 PR |
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Country : |
China |
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Financials (as on) : |
31.12.2013 |
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Date of Incorporation : |
03.11.2005 |
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Com. Reg. No.: |
330500400014663 |
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Legal Form : |
Chinese-Foreign Equity Joint Venture
Enterprise |
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Line of Business : |
Subject is engaged in the manufacturing PTFE and rubber products;
manufacturing and processing plastic rod, panel and pipe; selling its
products. |
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No. of Employees : |
120 |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Status : |
Moderate |
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Payment Behaviour : |
No complaints |
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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 31, 2014
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Country Name |
Previous Rating (31.12.2013) |
Current Rating (31.03.2014) |
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China |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
CHINA - ECONOMIC OVERVIEW
Since the late 1970s China
has moved from a closed, centrally planned system to a more market-oriented one
that plays a major global role - in 2010 China became the world's largest
exporter. Reforms began with the phasing out of collectivized agriculture, and
expanded to include the gradual liberalization of prices, fiscal
decentralization, increased autonomy for state enterprises, growth of the
private sector, development of stock markets and a modern banking system, and
opening to foreign trade and investment. China has implemented reforms in a
gradualist fashion. In recent years, China has renewed its support for
state-owned enterprises in sectors considered important to "economic
security," explicitly looking to foster globally competitive industries.
After keeping its currency tightly linked to the US dollar for years, in July
2005 China moved to an exchange rate system that references a basket of
currencies. From mid 2005 to late 2008 cumulative appreciation of the renminbi
against the US dollar was more than 20%, but the exchange rate remained
virtually pegged to the dollar from the onset of the global financial crisis
until June 2010, when Beijing allowed resumption of a gradual appreciation and
expanded the daily trading band within which the RMB is permitted to fluctuate.
The restructuring of the economy and resulting efficiency gains have
contributed to a more than tenfold increase in GDP since 1978. Measured on a
purchasing power parity (PPP) basis that adjusts for price differences, China
in 2013 stood as the second-largest economy in the world after the US, having
surpassed Japan in 2001. The dollar values of China's agricultural and
industrial output each exceed those of the US; China is second to the US in the
value of services it produces. Still, per capita income is below the world
average. The Chinese government faces numerous economic challenges, including:
(a) reducing its high domestic savings rate and correspondingly low domestic
consumption; (b) facilitating higher-wage job opportunities for the aspiring
middle class, including rural migrants and increasing numbers of college
graduates; (c) reducing corruption and other economic crimes; and (d)
containing environmental damage and social strife related to the economy's
rapid transformation. Economic development has progressed further in coastal
provinces than in the interior, and by 2011 more than 250 million migrant
workers and their dependents had relocated to urban areas to find work. One
consequence of population control policy is that China is now one of the most
rapidly aging countries in the world. Deterioration in the environment - notably
air pollution, soil erosion, and the steady fall of the water table, especially
in the North - is another long-term problem. China continues to lose arable
land because of erosion and economic development. The Chinese government is
seeking to add energy production capacity from sources other than coal and oil,
focusing on nuclear and alternative energy development. Several factors are
converging to slow China's growth, including debt overhang from its
credit-fueled stimulus program, industrial overcapacity, inefficient allocation
of capital by state-owned banks, and the slow recovery of China's trading
partners. The government's 12th Five-Year Plan, adopted in March 2011 and
reiterated at the Communist Party's "Third Plenum" meeting in
November 2013, emphasizes continued economic reforms and the need to increase
domestic consumption in order to make the economy less dependent in the future
on fixed investments, exports, and heavy industry. However, China has made only
marginal progress toward these rebalancing goals. The new government of
President XI Jinping has signaled a greater willingness to undertake reforms
that focus on China's long-term economic health, including giving the market a
more decisive role in allocating resources.
|
Source
: CIA |
Company
name and address
HUZHOU SONGHUA RUBBER AND PLASTIC Co., Ltd.
No. 58, chang’an street, wukang town, deqing
county,
huzhou, zhejiang PROVINCE, 313299 PR CHINA
TEL: 86 (0) 572-8086817
FAX: 86 (0) 572-8666261/8084338
EXECUTIVE
SUMMARY
INCORPORATION DATE : nov. 3, 2005
REGISTRATION NO. : 330500400014663
REGISTERED LEGAL FORM : CHINESE-FOREIGN EQUITY JOINT VENTURE ENTERPRISE
CHIEF EXECUTIVE :
MR. yang chenggang (legal representative)
STAFF STRENGTH :
120
REGISTERED CAPITAL : usd 1,020,000
BUSINESS LINE :
MANUFACTURING, processing & TRADING
TURNOVER :
CNY 50,230,000 (UNaudited, AS OF
DEC. 31, 2013)
EQUITIES :
CNY 15,490,000 (UNaudited, AS OF DEC. 31, 2013)
PAYMENT :
AVERAGE
MARKET CONDITION : average
FINANCIAL CONDITION : fairly stable
OPERATIONAL TREND : FAIRLY STEADY
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE :
CNY
6.25 = USD 1
Adopted
abbreviations:
ANS - amount not stated NS
- not stated SC - subject company (the
company inquired by you)
NA - not available CNY - China Yuan Renminbi
Note: the given tel. no. (86-572-8666261) should be SC’s fax no.
SC was registered as a Chinese-foreign equity joint venture enterprise
at local Administration for industry & commerce (AIC - the official body of
issuing and renewing business license) on Nov. 3, 2005.
Company Status: Chinese-foreign equity joint venture
enterprise This
form of business in PR China is defined as a legal person. It is a limited co.
jointly invested by one or more foreign companies and one or more PR China
controlled companies within the territories of PR China according to a
certain proportion of capital investment. The investing parties exercise
business management, share profits and bear all risks and liabilities of
the co. together. The equity joint venture law requires that foreign party
contribute not less than 25% of the registered capital, with no maximum.
The investing parties are free to agree on method of profit distribution
and liabilities bearing according to the proportion of capital investment.
Each investing parties contributes funds, tangible assets, technology &
etc. The board of directors excises the high authority. The joint venture
usually has a limited duration of 10 to 50 years. Enterprise with large
investment, long construction periods, low investment returns, introducing
of advanced technology & advanced technology products that have good
competition position in international market may extend beyond the 50 years
limit.
SC’s registered business scope includes manufacturing PTFE and rubber
products; manufacturing and processing plastic rod, panel and pipe; selling its
products. (with permit if needed).
SC is mainly engaged in manufacturing, processing and selling PTFE,
panels and pipes.
Mr. Yang Chenggang has been legal representative and chairman of SC
since 2014.
SC is known to have approx. 120 employees at present.
SC is currently operating at the above stated address, and this address houses
its operating office and factory in Huzhou. The detailed information of the
premise is unspecified.
http://www.zjsonghua.com/
The design is professional and the content is well organized. At present it is
in both Chinese and English versions.
Email: zjsonghua@zjsonghua.com
No significant events or changes were found during our checks with the
local Administration for Industry and Commerce.
Organization Code: 781813046
For the past two years there is no record of litigation.
MAIN SHAREHOLDERS:
Name %
of Shareholding
Deqing County Songhua Plastic Co., Ltd. 65
Wang Ruichang (Taiwanese)) 35
Deqing County Songhua Plastic Co., Ltd.
====================
Registered no.: 330521000008079
Legal representative: Yang Genyuan
Incorporation date:
Legal
representative and Chairman:
Mr. Yang Chenggang is currently
responsible for the overall management of SC.
Working
Experience(s):
From 2014 to present Working
in SC as legal representative and chairman
SC is mainly engaged in manufacturing, processing and selling PTFE,
panels and pipes.
SC’s products mainly include: PTFE, panels and pipes.
SC sources its materials 80% from domestic market, and 20% from overseas
market. SC sells 50% of its products in domestic market, and 50% to overseas
market.
The buying terms of SC include Check, T/T, L/C and Credit of 30-60 days.
The payment terms of SC include Check, T/T, L/C and Credit of 30-60 days.
Note: SC’s management declined to release its customer and supplier
details.
SC is not known to have any subsidiary at present.
Overall payment appraisal : ( ) Excellent (
) Good (X) Average (
) Fair ( ) Poor
( ) Not yet determined
The appraisal serves as a reference to reveal SC's payments habits and
ability to pay. It is based on the 3
weighed factors: Trade payment
experience (through current enquiry with SC's suppliers), our delinquent
payment and our debt collection record concerning SC.
Trade payment experience : SC did not provide any name of
trade/service suppliers and we have no other sources to conduct the enquiry at
present.
Delinquent payment record : None
in our database.
Debt collection record :No overdue amount owed by SC was placed to us for
collection within the last 6 years.
SC’s management declined to release its bank details.
Balance
Sheet
Unit: CNY’000
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as of Dec. 31,
2013 |
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Cash & bank |
7,790 |
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Inventory |
12,810 |
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Accounts receivable |
11,720 |
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Advances to suppliers |
1,140 |
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Other receivables |
1,160 |
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Other current assets |
40 |
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------------------ |
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Current assets |
34,660 |
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Fixed assets net value |
9,310 |
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Projects under construction |
3,250 |
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Long term investment |
0 |
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Intangible assets |
1,310 |
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Other assets |
0 |
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Total assets |
48,530 |
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Short loans |
23,350 |
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Notes payable |
4,660 |
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Accounts payable |
1,000 |
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Other payable |
3,120 |
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Taxes payable |
-120 |
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Advances from clients |
470 |
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Other current liabilities |
0 |
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Current liabilities |
32,480 |
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Long term liabilities |
560 |
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Total liabilities |
33,040 |
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Equities |
15,490 |
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Total liabilities & equities |
48,530 |
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Income
Statement
Unit: CNY’000
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as of Dec. 31,
2013 |
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Turnover |
50,230 |
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Cost of goods sold |
43,510 |
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Taxes and additional of main operation |
310 |
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Sales expense |
1,460 |
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Management expense |
5,770 |
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Finance expense |
1,660 |
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Non-operating income |
4,340 |
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Profit before tax |
1,860 |
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Less: profit tax |
0 |
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Profits |
1,860 |
Note: The above
financial have not been audited.
Important
Ratios
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as of Dec. 31,
2013 |
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*Current ratio |
1.07 |
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*Quick ratio |
0.67 |
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*Liabilities to assets |
0.68 |
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*Net profit margin (%) |
3.70 |
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*Return on total assets (%) |
3.83 |
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*Inventory /Turnover ×365 |
94 days |
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*Accounts receivable/Turnover ×365 |
86 days |
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*Turnover/Total assets |
1.04 |
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* Cost of goods sold/Turnover |
0.87 |
PROFITABILITY:
AVERAGE
The turnover of SC appears average in its line.
SC’s net profit margin is average.
SC’s return on total assets is average.
SC’s cost of goods sold is average, comparing with its turnover.
LIQUIDITY: AVERAGE
The current ratio of SC is maintained in a normal level.
SC’s quick ratio is maintained in a fair level.
The inventory of SC appears fairly large in 2013.
The accounts receivable of SC is maintained in an average level.
SC’s short-term loan appears large in 2013.
SC’s turnover is in an average level, comparing with the size of its
total assets.
LEVERAGE: AVERAGE
The debt ratio of SC is average.
The risk for SC to go bankrupt is average.
Overall financial condition of the SC: Fairly stable.
SC is considered medium-sized in its line with fairly stable financial
conditions. The large amount of short loans and inventory could be a threat to
SC’s financial condition.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
|
US Dollar |
1 |
Rs.59.30 |
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1 |
Rs.99.34 |
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Euro |
1 |
Rs.80.70 |
INFORMATION DETAILS
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Analysis Done by
: |
DIV |
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Report Prepared
by : |
NNA |
RATING EXPLANATIONS
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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>86 |
Aaa |
Possesses an extremely sound financial base with the strongest
capability for timely payment of interest and principal sums |
Unlimited |
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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 |
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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 |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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26-40 |
B |
Capability to overcome
financial difficulties seems comparatively below average. |
Small |
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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 |
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<10 |
C |
Absolute credit risk exists. Caution needed to be exercised |
Credit not
recommended |
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-- |
NB |
New Business |
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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.