MIRA INFORM REPORT

 

 

Report Date :

24.06.2014

 

IDENTIFICATION DETAILS

 

Name :

NGSK KAZSTROYSERVIS AO

 

 

Registered Office :

Business-Center Alatau Grand, Timiriyazev Street 28V, Almaty 050040

 

 

Country :

Kazakhstan

 

 

Financials (as on) :

31.12.2012

 

 

Date of Incorporation :

23.07.2001

 

 

Com. Reg. No.:

41384-1910-АО

 

 

Legal Form :

Joint Stock Company

 

 

Line of Business :

Building contractors specialising in oil, gas and water pipeline projects.

 

 

No. of Employees :

7,191 (subject)

25,000 (Group)

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

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)

Kazakhstan

B1

B1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderately Low Risk

 

B1

Moderate Risk

 

B2

Moderately High Risk

 

C1

High Risk

 

C2

Very High Risk

 

D

 


 

KAZAKHSTAN - ECONOMIC OVERVIEW

 

Kazakhstan, geographically the largest of the former Soviet republics, excluding Russia, possesses enormous fossil fuel reserves and plentiful supplies of other minerals and metals, such as uranium, copper, and zinc. It also has a large agricultural sector featuring livestock and grain. In 2002 Kazakhstan became the first country in the former Soviet Union to receive an investment-grade credit rating. Extractive industries have been and will continue to be the engine of Kazakhstan's growth, although the country is aggressively pursuing diversification strategies. Landlocked, with restricted access to the high seas, Kazakhstan relies on its neighbors to export its products, especially oil and grain. Although its Caspian Sea ports, pipelines, and rail lines carrying oil have been upgraded, civil aviation and roadways continue to need attention. Telecoms are improving, but require considerable investment, as does the information technology base. Supply and distribution of electricity can be erratic because of regional dependencies, but the country is moving forward with plans to improve reliability of electricity and gas supply to its population. At the end of 2007, global financial markets froze up and the loss of capital inflows to Kazakhstani banks caused a credit crunch. The subsequent and sharp fall of oil and commodity prices in 2008 aggravated the economic situation, and Kazakhstan plunged into recession. While the global financial crisis took a significant toll on Kazakhstan's economy, it has rebounded well, helped by prudent government measures. Rising commodity prices have helped the recovery. Despite solid macroeconomic indicators, the government realizes that its economy suffers from an overreliance on oil and extractive industries, the so-called "Dutch disease." In response, Kazakhstan has embarked on an ambitious diversification program, aimed at developing targeted sectors like transport, pharmaceuticals, telecommunications, petrochemicals and food processing. In 2010 Kazakhstan joined the Belarus-Kazakhstan-Russia Customs Union in an effort to boost foreign investment and improve trade relationships.

 

Source : CIA

 

 

Company name

 

CO. NAME :      NGSK KAZSTROYSERVIS AO (Correct)

                        JOINT STOCK COMPANY OGCC KAZSTROYSERVICE (Requested)

 

 

ADDRESS

 

Building : Business-Center Grand Alatau

 

Street   : Timiriyazev Street 28V

 

Town     : Almaty 050040

Country  : Kazakhstan

 

Telephone: (7 727) 258 2133 / 258 4273 / 266 9696 ext. 2404 (Chief        

Accountant)

Fax      : (7 727) 258 3171 / 258 4517

E-Mail   : sergey.teplyakov@kssmail.kz / info@kssmail.kz

Website  : www.kazstroyservice.com

 

English Translation : OGCC Kazstroyservice JSC

 

Formerly Known As : Kazstroyservis ZAO

 

Also Known As : Nefte-Gazovaya Stroitelnaya Kompaniya Kazstroyservis AO

 

 

SENIOR COMPANY PERSONNEL

 

   Name                                                   Position

 

1. Pankaj Jain                                            Group CEO  

 

2. Kaushik De Chaudhuri                           Chairman

 

3. Sabit Zhangirovich Zhanasov                Managing Director

 

4. Sergey Nikolayevich Shaydarov          Head of Pipeline Construction

 

5. Banaras Kumaresan                           Chief Commercial Officer

 

6. Ludmila Nikolaevna Pavlova               Head of Finance and Accounts

 

7. Nazira Alimzhanovna Tusupbekova    Head of Tax Department

 

7. Sergey Yuryevich Teplyakov              Chief Accountant

 

Total Employees :         7,191 (subject)

                                    25,000 (Group)

 

 

PAYMENTS

 

No complaints have been heard regarding payments from local suppliers or banks.

 

We consider it is acceptable to deal with subject for LARGE amounts,

although it is normal accepted practice for international suppliers to deal on secured terms with Kazakhstani importers.

 

Trade risk assessment: Normal

 

 

PRINCIPAL BANKERS

 

NAME     : NARODNIY BANK KAZAKHSTANA OAO

 

Branch   : Rozybakiyeva Street 101

Town     : Almaty 050046

 

Telephone: (7 727) 246 2881

Fax      : (7 727) 246 2865

 

Subject also has an account with the following banks:

 

1. HSBC Kazakhstan

   Dostyk Avenue 43

   Almaty 050100

   Telephone: (7 727) 258 1333

   Fax      : (7 727) 250 150

 

2. BTA BANK AO (frmly Bank Turan Alem AO)

   Lenina Avenue 39

   Almaty 050000

   Telephone: (7 727) 250 9645 / 261 1812

   Fax      : (7 727) 250 9632 / 253 1260

 

3. AKB Kazkommertsbank AO

   Bayseitovoy Avenue 49

   Almaty 050013

   Telephone: (7 727) 250 5101

 

4. RBS Bank Kazakhstan (frmly ABN Amro Bank Kazakhstan)

   Khadzhi Mukana Street 45

   Almaty 050059

   Telephone: (7 727) 258 1505

   Fax      : (7 727) 258 1506

 

5. Sberbank DB AO

   Kaldayakova Street 28

   Almaty 

   Telephone: (7 727) 250 0060

   Fax      : (7 727) 250 0063

 

6. Citibank Kazakhstan

   Park Palace, Building A

   Kazybek Bi Street 41

   Almaty 050100 

   Telephone: (7 727) 298 0400

   Fax      : (7 727) 298 0399

 

 

AUDITORS

 

Ernst & Young LLP

Esentai Tower. Al-Farabi Ave., 77/7.

Almaty 

Tel: (7 727) 258 5960

Fax: (7 727) 258 5961

License No.: Series MFYU-2, No. 0000003 (issue date : 15/07/2005)

 

 

FINANCIAL INFORMATION

 

Consolidated balance sheets as at 31 December 2012 showed :

 

                                          2011             2012

                                         (in thousands of TENGE)

 

ASSETS

 

Non-current assets:

Property, plant and equipment       22,997,477       24,974,466

Intangible assets                      167,174          156,569

Investments                         13,391,039       13,152,367

Prepayment for equipment               714,765            9,374

Other non-current assets             1,196,584        4,667,015

Deferred tax assets                    105,156          471,625

Long-term bank deposits                      -          100,000

                                    38,572,195       43,531,416

Current assets:

Inventories                          7,442,689        7,227,095

Accounts receivable                 31,500,176       29,495,711

Unbilled revenue                    42,223,616       47,984,466

Advances paid                        6,638,155        6,913,345

Prepaid income tax                     258,554          579,925

Prepaid taxes other than income tax  1,925,350          768,441

Loans to related parties               228,750          572,000

Other current assets                 1,633,993          593,798

Short-term deposits                    247,488           12,259

Restricted cash                         22,332           20,837

Cash and cash equivalents            1,516,151        4,183,993

                                    93,637,254       98,351,870

 

TOTAL ASSETS                       132,209,449      141,883,286

 

EQUITY AND LIABILITIES                                                                                                     

 

Equity:

Share capital                          678,550          678,550

Revaluation reserve                          -        4,196,668

Retained earnings                   41,355,715       48,036,680

Currency difference                   (254,901)        (311,197)

                                    41,779,364       52,600,701

Non-current liabilities:

Interest bearing loans and

borrowings                           3,026,667        1,262,754

Payable bonds                                -       11,290,156    

Finance lease payable                  655,245          364,025

Other non-current liabilities       10,301,373        8,804,424

Employee benefits liability             89,094          143,762

Deferred tax liabilities             1,933,219        2,486,469

                                    16,005,598       24,351,590     

Current liabilities:

Interest bearing loans and

borrowings                          27,645,580       16,651,801                                                 

Current portion of finance

lease payable                          303,051          299,411

Payable bonds – short-term part              -          417,088

Trade accounts payable              20,180,918       17,770,178

Advances from customers             20,813,584       22,366,112

Deferred revenue                             -           48,917

Current income tax payable             257,647          739,223

Taxes payable other than income tax  1,762,915        2,730,419

Current portion of employee benefits

liability                                9,593           14,044

Other current liabilities            3,451,199        3,893,802

                                    74,424,487       64,930,995

 

TOTAL EQUITY AND LIABILITIES       132,209,449      141,883,286

 


CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME     

 

                                          2011             2012

                                         (in thousands of TENGE)

 

Revenue                            109,275,421      100,010,375

Cost of revenue                    (99,735,289)     (79,822,982)

Gross profit                         9,540,132       20,187,393

General and administrative expenses (7,369,354)      (4,725,248)

Finance income                       1,975,556        3,217,707

Finance cost                        (3,665,539)      (6,445,789)

Foreign exchange gain, net             418,817          220,827

Loss on disposal of property, plant

and equipment                          (68,863)            (779)

Impairment (losses)/reversals, net    (196,187)      (1,295,666)

Other income                         7,321,721          153,799

Other expenses                        (149,576)        (140,093)

Share of profit of associates        2,862,716          902,572

Profit before income tax expense    10,669,423       12,074,723

Income tax expenses                 (2,587,821)      (2,304,866)

Profit for the year                  8,081,602        9,769,857                                                          

 

Financial year ends 31 December.

 

 

LEGAL STATUS AND HISTORY

 

Date Started :                           23 July 2001

 

History : The subject company was established in Kazakhstan on 23

July 2001 under the name KazStroyServis ZAO as a state owned company NK Kazmunaigaz AO. On 18 April 2005 NK Kazmunaigaz AO sold its shares to TOO Merkuriy and at the same time subject changed its name to NGSK KazStroyServis AO. In November 2006 Oileks Investments Ltd acquired 100% shares of the subject from TOO Merkuriy. In January 2007  subject's shareholding structure changed to the following : KazStroyService Limited, UK as a sole shareholder. On 30 May 2011 subject’s shareholding structure changed to the present.

 

C.R. No. :                                 41384-1910-АО

 

Tax No.:                                    RNN 600700228125

 

Business Identification Number : BIN 010740001371

 

Statistics number:                     OKPO 39534775

 

Authorised Capital :                   TENGE 678,550,000

 

Paid up Capital :                       TENGE 678,550,000

 

Aktsyonernoye Obshchestvo (joint stock company) with the following

sole shareholder :

 

KazStroyService Global B.V.                                         100%

Strawinskylaan 411

Amsterdam

The Netherlands

 

Affiliated companies of NGSK KazStroyServis AO :

 

Subsidiaries

 

1. KazStroyService Infrastructure India Private Limited     100%

   Gurgaon

   India 

   Est: July 2007

 

2. KazStroy Engineering Private Limited

   Vatika Towers B-Wing, 5th Floor, Sector 54

   Gurgaon

   India

 

3. KazStroyService Turkmenistan

   Yimpash Business Centre

   54, Shaely Street, Office 503

   Ashgabat

   Turkmenistan

 

4. KazStroyService Middle East

   Al-Otaiba Building Block 2, App. 302

   East Plot No. 3

   Airport Road

   Abu-Dhabi

   UAE

 

5. Engineering Procurement Services TOO                        100%

   Kazakhstan

 

6. Esker KazStroyServis TOO                                            50%

   Kazakhstan

 

7. Servis Pipes Holding TOO                                                       50%       

   Kazakhstan

 

Associates

 

1. PSN Kazstroy AO            

   Temirkhanova Street 8A

   Atyrau 060002

 

2. Boskalis-KSS LLP

   (address as per heading)

 

3. Keppel Kazakhstan LLP- Joint Venture Co.

   SEZ Seaport Aktau

   Aktau 130001

 

4. Petron Civil Engineering Private LTD

   Mumbai

   India

 

5. Petron Engineering Construction LTD

   Mumbai

   India

 

 

ACTIVITIES

 

Subject is involved in the following activities :

 

Building contractors specialising in oil, gas and water pipeline projects.

 

NACE Code : 4299

 

Imports from USA, Germany, Austria, UAE, China, India and Russia.

 

Subject does not export, all sales are domestic.

 

Subject’s projects include :

 

- Kazakh Oil Aktobe Gas Treatment plant. Oil gas pipeline

Construction Kozhasay deposit - MOGTS of Alibekmola deposit:

 

Oil Gas Pipeline Capacity: Alibekmola Gas Field-50,000 m3/per

                           hour;

                           Kozhasay Gas Field-37,738 m3/per hour;

 

- Karachaganak-Uralsk Gas Pipe – construction of a 147 km long Gas 

  Pipeline from Uralsk to Aksai with 10 Major Crossings,25 Valve

  Stations,5 Gas Distribution Stations,2 Bidirectional Scraper

  Traps;

 

- Zhaikmunay Gas Treatment Plant construction – gas treatment units

  withan annual capacity of 1.7 billion m3.

 

- 1300 km long gas pipeline Kazakhstan- China;

 

- 841 km long Kenkiyak-Kumkol Oil Pipeline;

 

Subject's principal clients include : Karachaganak Petroleum Operating BV, ABN Amro Bank NV and Exterran Energy Solutions LP.

 

 

FACILITIES

 

Subject has the following facilities :

 

Administrative offices and warehousing facilities located at the heading address as well as 12 regional branches located throughout Kazakhstan.

 

Subject previously operated from the following address :

 

Dostyk Avenue 248B

Almaty 050020

 

 

REGISTERED OFFICE

 

Business-Center Alatau Grand

Timiriyazev Street 28V

Almaty 050040

 

Until 26 July 2010 subject’s registered address was located at :

 

Dostyk Avenue 248B

Almaty 050020

 

Until May 2008 subject's registered office address located at:

 

Chaykovskogo Street 95

Almaty 050094

 

 

SPECIAL NOTE

 

You enquired on :          JOINT STOCK COMPANY OGCC KAZSTROYService .Please note that subject’s correct registered name is as per heading.

 

Interviewed:                   Sergey Yuryevich Teplyakov (Chief Accountant).

 

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.60.19

UK Pound

1

Rs.102.56

Euro

1

Rs.81.91

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

NNA

 

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.