MIRA INFORM REPORT

 

 

Report Date :

19.03.2014

 

 

IDENTIFICATION DETAILS

 

Name :

CITIC TELECOM INTERNATIONAL LTD.

 

 

Registered Office :

25/F., CITIC Telecom Tower, 93 Kwai Fuk Road, Kwai Chung, New Territories

 

 

Country :

Hong Kong

 

 

Date of Incorporation :

05.12.1996

 

 

Com. Reg. No.:

21615094

 

 

Legal Form :

Private Limited Company

 

 

Line of Business :

Provision of licensed telecommunications services.

 

 

No of Employees :

482   (Hong Kong)

1,416 Mainland China & Macau

118   Overseas

 

 

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 – december 01, 2013

 

Country Name

Previous Rating

(30.09.2013)

Current Rating

(01.12.2013)

Hong Kong

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 


 

HONG KONG - ECONOMIC OVERVIEW

 

Hong Kong has a free market economy, highly dependent on international trade and finance - the value of goods and services trade, including the sizable share of re-exports, is about four times GDP. Hong Kong has no tariffs on imported goods, and it levies excise duties on only four commodities, whether imported or produced locally: hard alcohol, tobacco, hydrocarbon oil, and methyl alcohol. There are no quotas or dumping laws. Hong Kong's open economy left it exposed to the global economic slowdown that began in 2008. Although increasing integration with China, through trade, tourism, and financial links, helped it to make an initial recovery more quickly than many observers anticipated, its continued reliance on foreign trade and investment leaves it vulnerable to renewed global financial market volatility or a slowdown in the global economy. The Hong Kong government is promoting the Special Administrative Region (SAR) as the site for Chinese renminbi (RMB) internationalization. Hong Kong residents are allowed to establish RMB-denominated savings accounts; RMB-denominated corporate and Chinese government bonds have been issued in Hong Kong; and RMB trade settlement is allowed. The territory far exceeded the RMB conversion quota set by Beijing for trade settlements in 2010 due to the growth of earnings from exports to the mainland. RMB deposits grew to roughly 12% of total system deposits in Hong Kong by the end of 2013. The government is pursuing efforts to introduce additional use of RMB in Hong Kong financial markets and is seeking to expand the RMB quota. The mainland has long been Hong Kong's largest trading partner, accounting for about half of Hong Kong's total trade by value. Hong Kong's natural resources are limited, and food and raw materials must be imported. As a result of China's easing of travel restrictions, the number of mainland tourists to the territory has surged from 4.5 million in 2001 to 34.9 million in 2012, outnumbering visitors from all other countries combined. Hong Kong has also established itself as the premier stock market for Chinese firms seeking to list abroad. In 2012 mainland Chinese companies constituted about 46.6% of the firms listed on the Hong Kong Stock Exchange and accounted for about 57.4% of the Exchange's market capitalization. During the past decade, as Hong Kong's manufacturing industry moved to the mainland, its service industry has grown rapidly. Credit expansion and tight housing supply conditions have caused Hong Kong property prices to rise rapidly; consumer prices increased by more than 4% in 2013. Lower and middle income segments of the population are increasingly unable to afford adequate housing. Hong Kong continues to link its currency closely to the US dollar, maintaining an arrangement established in 1983. In 2013, Hong Kong and China signed new agreements under the Closer Economic Partnership Agreement, adopted in 2003 to forge closer ties between Hong Kong and the mainland. The new measures, effective from January 2014, cover services and trade facilitation, and will improve access to the mainland's service sector for Hong Kong-based companies.

 

Source : CIA

 


 

COMPANY NAME & ADDRESS

 

CITIC  TELECOM  INTERNATIONAL  LTD.

 

ADDRESS:       25/F., CITIC Telecom Tower, 93 Kwai Fuk Road, Kwai Chung, New Territories, Hong Kong.

 

PHONE:            852-2820 2111,  2104 5511

 

FAX:                 852-2877 2771

 

 

MANAGEMENT

 

Group Chief Executive Officer:  Mr. Yuen Kee Tong, Norman

 

 

SUMMARY

 

Incorporated on:            5th December, 1996.

 

Organization:                 Private Limited Company.

 

Capital: Nominal:           HK$10,000.00

            Issued:             HK$2.00

 

Business Category:       Provision of licensed telecommunications services.

 

Group Turnover:            HK$6,018,543,000  (Year ended 31-12-2013)

 

Group Employees:        2,016.  (As at 31-12-2013)

 

Main Dealing Banker:     The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

 

Banking Relation:          Good.

 

 

COMPANY NAME

 

CITIC  TELECOM  INTERNATIONAL  LTD.

 

 

 

ADDRESS

 

Registered Head Office:-

25/F., CITIC Telecom Tower, 93 Kwai Fuk Road, Kwai Chung, New Territories, Hong Kong.

 

China Factory:  Shenzhen Special Economic Zone, China.

 

 

Holding Company

 

CITIC Telecom International Holdings Ltd. [CTIH], Hong Kong.

 

 

Intermediate Holding Company

 

CITIC Pacific Ltd., Hong Kong.

 

 

Ultimate Holding Company

 

CITIC Group Corporation, China.

 

 

Associated Companies

 

CTIH Group of Companies

Asia Pacific Internet Exchange Ltd., Hong Kong.

China Enterprise ICT Solutions Ltd., China.

[formerly known as China Enterprise Communications Ltd.]

China Enterprise Netcom Corporation Ltd., Hong Kong.

CITIC 1616 Holdings Ltd., Hong Kong.

CITIC Media 1616 Ltd., Hong Kong.

CITIC Telecom (UK) Ltd., UK.

CITIC Telecom International (Concept) Ltd., Hong Kong.

CITIC Telecom International (Data ) Ltd., Hong Kong.

CITIC Telecom International (Japan) Ltd., Japan.

CITIC Telecom International (SEA) Pte. Ltd., Singapore.

CITIC Telecom International CPC (Singapore) Pte. Ltd., Singapore.

CITIC Telecom International CPC Japan Ltd., Japan.

CITIC Telecom International CPC Ltd., Hong Kong.

CITIC Telecom International Finance Ltd., British Virgin Islands.

CITIC TeleSoft 1616 Ltd., Hong Kong.

ComNet (USA) LLC, US.

ComNet Investment Ltd., Hong Kong.

ComNet Telecom (Canada) Ltd., Canada.

ComNet Telecom (HK) Ltd., Hong Kong.

ComNet Telecom (Singapore) Pte. Ltd., Singapore.

ComNet Telecom International Ltd., Hong Kong.

Companhia de Telecomunicacoes de Macau S.A.R.L., Macau.

Nebular Telecom Japan K.K., Japan.

etc.

 

 

BUSINESS REGISTRATION NUMBER

 

21615094

 

 

COMPANY FILE NUMBER 

 

0578370

 

 

MANAGEMENT

 

Group Chairman:  Mr. Xin Yue Jiang

Group Chief Executive Officer:  Mr. Yuen Kee Tong, Norman

 

 

CAPITAL

 

Nominal Share Capital: HK$10,000.00 (Divided into 10,000 shares of HK$1.00 each)

 

Issued Share Capital: HK$2.00

 

 

SHAREHOLDER  

 

(As per registry dated 05-12-2013)

Name

 

No. of shares

CITIC Telecom International Holdings Ltd., Hong Kong.

 

2

=

 

 

DIRECTORS  

 

(As per registry dated 05-12-2013)

Name

(Nationality)

 

Address

YUEN Kee Tong, Norman

House 101, Palm Drive, The Redhill Peninsula, 18 Pak Pat Shan Road, Tai Tam, Hong Kong.

 

CHAN Tin Wai, David

Flat 2, 4/F., Block K, Beverly Hill, 6 Broadwood Road, Hong Kong.

 

XIN Yue Jiang

Flat B, 28/F., Regal Crest, 9 Robinson Road, Hong Kong.

 

LIU Jifu

76 Headland Drive, Discovery Bay, Hong Kong.

 

 

SECRETARY

 

(As per registry dated 05-12-2013)

Name

Address

Co. No.

CITIC Secretaries Ltd.

32/F., CITIC Tower, 1 Tim Mei Avenue, Central, Hong Kong.

0208916

 

 

HISTORY

 

The subject was incorporated on 5th December, 1996 as a private limited liability company under the Hong Kong Companies Ordinance.

 

Originally the subject was registered under the name of Natural Resources Ltd., name changed to Telecom 1616 Ltd. on 15th January, 1999, to CITIC Telecom 1616 Ltd. on 20th October, 2000, and further to the present style on 26th November, 2010.

 

Formerly the subject was located at 8/F., CITIC Tower, 1 Tim Mei Avenue, Central, Hong Kong, moved to 25/F., Broadway Centre, 93 Kwai Fuk Road, Kwai Chung, New Territories, Hong Kong with effect from 4th October, 2010.  The name of the building changed from Broadway Centre to CITIC Telecom Tower on 28th November, 2010.

 

Apart from these, neither material change nor amendment has been ever traced and noted.

 

 

OPERATIONS

 

Activities & Lines:          Provision of licensed telecommunications services.

 

Group Employees:        2,016 (As at 31-12-2013)

                                    482   (Hong Kong)

1,416   Mainland China & Macau

                                    118   Overseas

 

Business Territories:      China, North America, Europe and other countries.

 

Group Turnover:            HK$2,716,559,000  (Year ended 31-12-2009)

HK$2,966,469,000  (Year ended 31-12-2010)

HK$3,196,753,000  (Year ended 31-12-2011)

HK$3,609,810,000  (Year ended 31-12-2012)

HK$6,018,543,000  (Year ended 31-12-2013)

 

Terms/Services:            COD or as per contracted.

 

 

FINANCIAL INFORMATION

 

Nominal Share Capital:                                      HK$10,000.00 (Divided into 10,000 shares of HK$1.00 each)

 

Issued Share Capital:                                         HK$2.00

 

Group Profit Attributable to Shareholders:-

HK$   371,527,000  (Year ended 31-12-2009)

HK$   401,288,000  (Year ended 31-12-2010)

HK$   458,246,000  (Year ended 31-12-2011)

HK$   461,283,000  (Year ended 31-12-2012)

HK$1,067,506,000  (Year ended 31-12-2013)

 

Profit or Loss:                                                   Business is profitable.

 

Condition:                                                         Business is active and normal.

 

Facilities:                                                          Making active use of general banking facilities.

 

Payment:                                                          Regularly met.

 

Commercial Morality:                                         Good.

 

Banker:                                                             The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

 

Standing:                                                          Good.

 

 

GENERAL

 

CITIC Telecom International Ltd. is an international telecommunication service provider.  It is a wholly-owned subsidiary of CITIC Telecom International Holdings Ltd. [CITIC Telecom / CTIH] which is a public listed firm in Hong Kong.  CTIH now is the holding company of the CTIH Group.

 

Established in 1999, CTIH’s shares have been listed on the Main Board of The Stock Exchange of Hong Kong Ltd. with stock code 1883 since 3rd April, 2007.

 

The Group Telecom is a reputable telecoms operator in Asia.  CITIC Telecom owns and operates a telecoms hub with its key markets in China and Hong Kong.  The Group is actively expanding its business internationally by providing interoperability and interconnection services to global telecoms operators.  CITIC Telecom’s main businesses cover Voice Services, SMS Services, Mobile VAS and Data Services.  It also provides a full range of Information and Communications Technology (ICT) solutions through its wholly-owned subsidiary, CITIC Telecom International CPC Limited [CITIC Telecom CPC], across the Asia Pacific region. CITIC Telecom CPC is a preferred partner of leading multinational corporations and business enterprises.

 

CITIC Telecom holds 99% interest in Companhia de Telecomunicações de Macau, S.A.R.L. [CTM], one of Macau’s leading integrated telecoms services provider.  CTM, the only full telecoms service provider in Macau, is a long-time leader in providing world-class telecoms services to Macau residents and enterprises while playing a major role in the ongoing development of Macau.

 

CITIC Group Corporation, one of the largest commercial organisations in the People’s Republic of China, is the ultimate holding company of CITIC Telecom.

 

Parent company of CTIH, CITIC Pacific Ltd. [CITIC Pacific], is also a publicly quoted Hong Kong company with a diversified portfolio and unrivalled expertise in operating businesses in Hong Kong and Mainland China.  CITIC Pacific’s core international business includes special steel manufacturing, civil infrastructure, aviation, property development, power generation, marketing and distribution as well as communications.  CITIC Pacific also enjoys strong support from its substantial shareholder, Beijing‑based conglomerate CITIC Group.

 

For the year ended 31st December, 2012, the Group reported a total revenue of HK$6,018.5 million, representing an increase of 66.7% over the previous year.  Profit attributable to equity shareholders of the Company grew 131.4% year-on-year to HK$1,067.5 million (2011: HK$461.3 million).

 

Voice services for CITIC Telecom represent the Group’s traditional telecoms hubbing services.  Voice services revenue decreased by HK$403.3 million or 19.4% to HK$1,676.3 million for 2013 when compared with 2012.  The Group handled a total traffic of 7.01 billion minutes, a 19.1% reduction compared with last year.  Total China inbound and outbound traffic for the year has dropped by 18.4% and total international traffic dropped by 20.4% when compared to 2012.  The decrease in traffic is due to the weak performance of global voice wholesales market.  In order to mitigate the adverse impact, the Group implemented a strategy in targeting regions with higher margin.  As a result, overall revenue per minute was HK$0.24 which was the same as previous year.

 

SMS services sustained stable growth in 2013 with turnover reaching HK$416.5 million for the year ended 31st December 2013, an overall growth of 10.9% as compared to 2012.  Owing to the increasing popularity of social networking applications, the number of Hong Kong domestic SMS dropped by 29.0% during the year.  However, the Group accelerated the development of corporate SMS to minimise the substitution impact brought by emerging internet applications.  The number of international SMS achieved strong growth of 22.7% and the increase in international and corporate traffic has partly offset the decrease in local domestic SMS.

 

Although the number of messages handled by the Group has dropped by 8.6% to 1,691.5 million messages from 2012, the average revenue per SMS has increased by approximately 25.0%.

 

As at the end of December 2013, the Group employed a total of 2,016 employees (2012: 900) for its headquarter in Hong Kong and its principal subsidiaries.

 

Number of employees in Hong Kong was 482.  Employee in mainland China and Macau totalled 1,416.  Employees in overseas countries totalled 118.

 

The increase in number of employees was mainly due to acquisition projects completed during the year.

The subject is fully supported by the CTIH Group.

 

On the whole, consider it good for normal business engagements.

 

 

REMARKS

 

Personal profile of the principal directors:-

 

Mr. XIN Yue Jiang, aged 65, has been appointed as the Chairman of CTIH from 19th March, 2009.  He joined CTIH in January 2008 as Executive Director and Vice Chairman of the Board.  He is also the Chairman of Companhia de Telecomunicacoes de Macau, S.A.R.L. [CTM], a subsidiary of CTIH.  Mr. Xin graduated from China Naval Aeronautic Engineering Institute and Central University of Finance and Economics and obtained a Master degree in Economics and Management from the Graduate School of Chinese Academy of Social Sciences.  After serving a substantial period of time in the PRC government in which Mr. Xin was involved in the administration of science, technology information and economics, Mr. Xin joined in succession various major conglomerates as senior management, researcher or chief engineer.  When Mr. Xin was with China Netcom (Hong Kong) Operations Ltd., he held the position of senior vice president and senior consultant.  Mr. Xin had also participated in the planning, implementation and management of many different important state projects.  Mr. Xin thus possesses extensive knowledge and experience in science and technology information, business operation and management, and capital market operation.  Since 1985, Mr. Xin has joined many different overseas studies and visits, and gained many valuable experiences in promoting co-operation with overseas enterprises, technology exchange, product research and development, and product marketing.  Mr. Xin has long been interested in the study and research of corporate governance and corporate culture, in particular the characteristics of Western economy and the corporate governance practices adopted by overseas enterprises, and has made significant achievement in that regard.

 

Mr. YUEN Kee Tong, J.P., aged 65, is the Chief Executive Officer of CTIH.  Mr. Yuen is the Corporate Representative of CTIH on the Borad of CTM an d the Vice Chairman of China Enterprise ICT Solutions Ltd. [formerly knows as China Enterprise Communications Ltd.] [CEC]  Mr. Yuen is a member of the Association of Chartered Certified Accountants of the United Kingdom and also a member of the Hong Kong Institute of Certified Public Accountants.  He joined CITIC Pacific, the controlling shareholder of CTIH, in 2001 as the Deputy Managing Director.  Mr. Yuen resigned from the Board of CITIC Pacific on 8th January, 2007 and assumed the position of director and Chief Executive Officer of CTIH on the same day.  Mr. Yuen has more than 20 years extensive experience in all aspects of telecoms industry.  Mr. Yuen was the Deputy Chief Executive of Hong Kong Telecommunications Ltd. and later, Pacific Century CyberWorks Ltd.  Mr. Yuen served many public bodies and advisory committees.

 

Dr. CHAN Tin Wai, David, aged 49, is the Chief Financial Officer of CTIH and he joined the CTIH in June 2006.  Dr. Chan is also a director of CTM and CEC.  Dr. Chan obtained a LLB (Hons) degree and a Master degree of Law from the University of London in the United Kingdom, a Master degree of Accounting from Curtin University in Australia and a Doctor degree of Business Administration from the University of Newcastle in Australia.  He is a member of the Institute of Chartered Accountants in England and Wales and also a fellow member of the Association of Chartered Certified Accounts, the Institute of Chartered Secretaries and Administrators, the Hong Kong Institute of Certified Public Accountants, the Taxation Institute of Hong Kong and the Hong Kong Institute of Chartered Secretaries.  Dr. Chan worked in CITIC Pacific during the period from 1994 to 2000.  He had worked in several multi-national and Hong Kong blue chip companies and has over 25 years of experience in overseeing corporate finance, merger and acquisition activities, accounting, company secretarial, administration, human resources and legal matters.

 

 


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.60.94

UK Pound

1

Rs.101.37

Euro

1

Rs.84.89

 

 

INFORMATION DETAILS

 

Report Prepared by :

DPT

 

 

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%)

 

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.