MIRA
INFORM REPORT
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Report Date : |
20.05.2014 |
IDENTIFICATION DETAILS
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Name : |
GUANGZHOU
DIANHUI TRADE CO., LTD. |
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Registered Office : |
Room 420, 4/F, Huijing Mansion, No. 136 Siyou New Road,
Yuexiu District, Guangzhou City, Guangdong Province, 510699 PR |
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Country : |
China |
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Financials (as on) : |
31.12.2013 |
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Date of Incorporation : |
11.11.2009 |
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Com. Reg. No.: |
440104000040246 |
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Legal Form : |
Limited Liabilities Company |
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Line of Business : |
Engaged in selling chemical raw materials. |
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No. of Employees |
11 |
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 : |
Slow but correct |
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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
GUANGZHOU DIANHUI TRADE CO., LTD.
ROOM 420,
4/F, HUIJING MANSION, NO. 136 SIYOU NEW ROAD, YUEXIU DISTRICT, GUANGZHOU CITY,
GUANGDONG PROVINCE, 510699 PR CHINA
TEL: 86 (0) 20-26298416 FAX: 86 (0) 20-26298415
EXECUTIVE SUMMARY
INCORPORATION DATE : nOv. 11, 2009
REGISTRATION NO. : 440104000040246
REGISTERED LEGAL FORM : Limited liabilities
company
STAFF STRENGTH :
11
REGISTERED CAPITAL : CNY 1,000,000
BUSINESS LINE :
trading
TURNOVER :
CNY 29,750,000 (AS OF DEC. 31, 2013)
EQUITIES :
CNY -50,000 (AS OF DEC. 31, 2013)
PAYMENT :
AVERAGE
RECOMM. CREDIT RANGE : C.O.D.
MARKET CONDITION : AVERAGE
FINANCIAL CONDITION : FAIR
OPERATIONAL TREND : fair
GENERAL REPUTATION : AVERAGE
EXCHANGE RATE :
CNY
6.2337 = 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: SC’s correct name shall be the heading one; and the (Room 410 No
9, Gangtou Street, Western Guangyuan Guangzhou Yuexiu District China) was SC’s
former operation address.
SC was registered as a limited liabilities co. at local Administration
for Industry & Commerce (AIC - The official body of issuing and renewing
business license) on Nov. 11, 2009.
Company Status: Limited Liability Company This form of business in PR
China is defined as a legal person. No more than fifty shareholders
contribute its registered capital jointly. Shareholders bear limited liability
to the extent of shareholding, and the co. is liable for its debts only to
extent of its total assets. The characteristics of this form of co. are as
follows: Upon
the establishment of the co., an investment certificate is issued to the
each of shareholders. The board of directors is
comprised of three to thirteen members. The minimum registered capital
for a co. is CNY 30,000. Shareholders may take their
capital contributions in cash or by means of tangible assets or intangible
assets such as industrial property and non-patented technology. Cash contributed by all
shareholders must account for at least 30% of the registered capital. Existing shareholders have
pre-exemption right to purchase shares of the co. offered for sale by the
other shareholders and to subscribe for the newly increased registered
capital of the co.
SC’s registered
business scope includes wholesaling and retailing trade; import and export of
goods and technology.
SC is mainly engaged
in selling chemical raw materials.
Ms. Wu Xiaojing is
the legal representative, chairman and general manager of SC at present.
SC is known to have approx. 11 employees at
present.
SC is currently operating at the above stated address, and this
address houses its operating office in the commercial zone of Guangzhou. Detailed premise
information is unspecified.
SC is not known to host website of its own at present.
Subject passed the annual inspection of
2012 with Administration for Industry & Commerce.
Organization Code: 696921536
Note: SC’s former registered capital is CNY 500,000 and its former shareholders and % of shareholding is Zhu
Xiaojing 10%, Wu Yishi 20%, Wu Xiaojing
For the past two years there is no record of litigation.
MAIN SHAREHOLDERS:
Name %
of Shareholding
Wu Xiaojing 98.5
Wu Yishi 1
Li Liqun 0.5
l
Legal representative, Chairman and General
manager:
Ms. Wu Xiaojing is
currently responsible for the overall management of SC.
Working Experience(s):
At present Working
in SC as legal representative, chairman and general manager
Supervisor:
……………
Wu Yishi
SC is mainly
engaged in selling chemical raw materials.
Main Products:
various chemical raw materials
SC sources its materials 100%
from overseas market. SC sells 100% of its products in domestic 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 and Credit of 30-60
days.
Note:
SC refused to release its major suppliers and clients
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 |
1,690 |
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Inventory |
1,480 |
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Accounts
receivable |
11,000 |
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Other Accounts
receivable |
1,440 |
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Advances to
suppliers |
480 |
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Other current
assets |
0 |
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------------------ |
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Current assets |
16,090 |
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Fixed assets net
value |
950 |
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Projects under construction |
0 |
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Long-term
investment |
0 |
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Intangible
assets |
0 |
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Long-term
deferred expenses |
0 |
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Other assets |
0 |
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------------------ |
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Total assets |
17,040 |
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============= |
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Short loans |
0 |
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Accounts payable |
2,040 |
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Advance from
customers |
0 |
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Other Accounts
payable |
15,020 |
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Other Accounts
payable to government |
10 |
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Salaries payable |
0 |
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Taxes payable |
20 |
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Other current
liabilities |
0 |
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------------------ |
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17,090 |
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Long term
liabilities |
0 |
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------------------ |
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Total
liabilities |
17,090 |
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Equities |
-50 |
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------------------ |
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17,040 |
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============= |
Income Statement
Unit: CNY’000
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As of Dec. 31, 2013 |
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Turnover |
29,750 |
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Cost of goods sold |
27,210 |
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Taxes and additional of main operation |
20 |
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Sales expense |
2,220 |
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Management expense |
960 |
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Finance expense |
150 |
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Exchange gain |
100 |
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Non-operation expenses |
10 |
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Profit before
tax |
-720 |
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Less: profit tax |
0 |
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Profits |
-720 |
Important Ratios
=============
|
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As of Dec. 31, 2013 |
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*Current ratio |
0.94 |
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*Quick ratio |
0.85 |
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*Liabilities
to assets |
1.00 |
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*Net profit
margin (%) |
-2.42 |
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*Return on
total assets (%) |
-4.23 |
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*Inventory
/Turnover ×365 |
18 days |
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*Accounts
receivable/Turnover ×365 |
135 days |
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*Turnover/Total
assets |
1.75 |
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* Cost of
goods sold/Turnover |
0.91 |
PROFITABILITY:
FAIR
l
The turnover of SC appears average in its line.
l
SC’s net profit margin is fair.
l
SC’s return on total assets is fair.
l
SC’s cost of goods sold is average, comparing with
its turnover.
LIQUIDITY: AVERAGE
l
The current ratio of SC is maintained in a fair level.
l
SC’s quick ratio is maintained in a normal level.
l
SC’s inventory is average in 2013.
l
SC’s accounts receivable is large in 2013.
l
SC has no short-term loan in 2013.
l
SC’s turnover is in an average level, comparing
with the size of its total assets.
LEVERAGE: POOR
l
The debt ratio of SC is too high.
l
The risk for SC to go bankrupt is fairly high.
Overall financial
condition of the SC: Fair.
SC is considered small-sized in its line with fair financial conditions.
The large amount of accounts receivable would be a threat to SC’s financial
conditions. Taking into consideration of SC’s general performance and operation
size, C.O.D. is recommended.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.58.42 |
|
|
1 |
Rs.98.28 |
|
Euro |
1 |
Rs.80.11 |
INFORMATION DETAILS
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Analysis Done by
: |
KAR |
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Report Prepared
by : |
PDT |
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.