|
Report Date : |
05.11.2014 |
IDENTIFICATION DETAILS
|
Name : |
SCHLUMBERGER LIMITED |
|
|
|
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Registered Office : |
5599 San Felipe, 17th floor, Houston, TX 77056 |
|
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Country : |
United States |
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Date of Incorporation : |
06.11.1956 |
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Legal Form : |
Public Company (NYSE = SLB) |
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Line of Business : |
Subject, together with its subsidiaries, supplies technology, integrated
project management, and information solutions to the oil and gas exploration
and production industries worldwide. |
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No of Employees : |
123,000 |
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 : |
Satisfactory |
|
Payment Behaviour : |
No Complaints |
|
Litigation : |
-- |
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 – June 1, 2014
|
Country Name |
Previous Rating (31.03.2014) |
Current Rating (01.06.2014) |
|
United States |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
UNITED STATES - ECONOMIC OVERVIEW
The US has the largest and
most technologically powerful economy in the world, with a per capita GDP of
$49,800. In this market-oriented economy, private individuals and business
firms make most of the decisions, and the federal and state governments buy needed
goods and services predominantly in the private marketplace. US business firms
enjoy greater flexibility than their counterparts in Western Europe and Japan
in decisions to expand capital plant, to lay off surplus workers, and to
develop new products. At the same time, they face higher barriers to enter
their rivals' home markets than foreign firms face entering US markets. US
firms are at or near the forefront in technological advances, especially in
computers and in medical, aerospace, and military equipment; their advantage
has narrowed since the end of World War II. The onrush of technology largely
explains the gradual development of a "two-tier labor market" in
which those at the bottom lack the education and the professional/technical
skills of those at the top and, more and more, fail to get comparable pay
raises, health insurance coverage, and other benefits. Since 1975, practically
all the gains in household income have gone to the top 20% of households. Since
1996, dividends and capital gains have grown faster than wages or any other
category of after-tax income. Imported oil accounts for nearly 55% of US
consumption. Crude oil prices doubled between 2001 and 2006, the year home
prices peaked; higher gasoline prices ate into consumers' budgets and many
individuals fell behind in their mortgage payments. Oil prices climbed another
50% between 2006 and 2008, and bank foreclosures more than doubled in the same
period. Besides dampening the housing market, soaring oil prices caused a drop
in the value of the dollar and a deterioration in the US merchandise trade
deficit, which peaked at $840 billion in 2008. The sub-prime mortgage crisis,
falling home prices, investment bank failures, tight credit, and the global
economic downturn pushed the United States into a recession by mid-2008. GDP
contracted until the third quarter of 2009, making this the deepest and longest
downturn since the Great Depression. To help stabilize financial markets, in
October 2008 the US Congress established a $700 billion Troubled Asset Relief
Program (TARP). The government used some of these funds to purchase equity in
US banks and industrial corporations, much of which had been returned to the
government by early 2011. In January 2009 the US Congress passed and President
Barack OBAMA signed a bill providing an additional $787 billion fiscal stimulus
to be used over 10 years - two-thirds on additional spending and one-third on
tax cuts - to create jobs and to help the economy recover. In 2010 and 2011,
the federal budget deficit reached nearly 9% of GDP. In 2012 the federal
government reduced the growth of spending and the deficit shrank to 7.6% of
GDP. Wars in Iraq and Afghanistan required major shifts in national resources
from civilian to military purposes and contributed to the growth of the budget
deficit and public debt. Through 2011, the direct costs of the wars totaled
nearly $900 billion, according to US government figures. US revenues from taxes
and other sources are lower, as a percentage of GDP, than those of most other
countries. In March 2010, President OBAMA signed into law the Patient
Protection and Affordable Care Act, a health insurance reform that was designed
to extend coverage to an additional 32 million American citizens by 2016,
through private health insurance for the general population and Medicaid for
the impoverished. Total spending on health care - public plus private - rose
from 9.0% of GDP in 1980 to 17.9% in 2010. In July 2010, the president signed
the DODD-FRANK Wall Street Reform and Consumer Protection Act, a law designed
to promote financial stability by protecting consumers from financial abuses,
ending taxpayer bailouts of financial firms, dealing with troubled banks that
are "too big to fail," and improving accountability and transparency
in the financial system - in particular, by requiring certain financial
derivatives to be traded in markets that are subject to government regulation
and oversight. In December 2012, the Federal Reserve Board (Fed) announced
plans to purchase $85 billion per month of mortgage-backed and Treasury
securities in an effort to hold down long-term interest rates, and to keep
short term rates near zero until unemployment drops below 6.5% or inflation
rises above 2.5%. In late 2013, the Fed announced that it would begin scaling
back long-term bond purchases to $75 billion per month in January 2014 and
reduce them further as conditions warranted; the Fed, however, would keep
short-term rates near zero so long as unemployment and inflation had not
crossed the previously stated thresholds. Long-term problems include stagnation
of wages for lower-income families, inadequate investment in deteriorating
infrastructure, rapidly rising medical and pension costs of an aging
population, energy shortages, and sizable current account and budget deficits.
|
Source
: CIA |
SCHLUMBERGER
LIMITED
(SCHLUMBERGER
N.V.)
Address: 5599 San Felipe, 17th
floor, Houston, TX 77056 - USA
Headquarters: Johan Van Walbeeckplein 11
Curaçao (Netherlands Antilles)
Telephone: +1
713-513-2000
Fax: +1 713-513-2006
Website: www.slb.com
Corporate ID#: 1674
State: Curaçao
Judicial form: Public Company (NYSE = SLB)
Date incorporated: November
6, 1956
Stock: 1,286,793,905
shares
Value: USD
0.01= par value
Name of manager: Paal
Business:
Schlumberger Limited, together with its subsidiaries, supplies technology,
integrated project management, and information solutions to the oil and gas
exploration and production industries worldwide.
Its Reservoir Characterization Group segment provides reservoir imaging,
monitoring, and development services; wireline technology that offers open-hole
and cased-hole services; exploration and production pressure and flow-rate
measurement services; information solutions, such as consulting, software,
information management system, and IT infrastructure services that support oil
and gas industry; and data and consulting services.
The company’s Drilling Group segment designs, manufactures, and markets
roller cone and fixed cutter drill bits, and drilling fluid systems; geo
services; supplies engineering support, directional-drilling,
measurement-while-drilling, and logging-while-drilling services; provides drill
bits, borehole enlargement technologies, impact tools, and tubulars and tubular
services; and dynamic pressure management solutions. Its Reservoir Production
Group segment provides well services; well completion services and equipment;
artificial lift; coiled tubing equipment and services; slickline services for
downhole mechanical well intervention, reservoir monitoring, and downhole data
acquisition; subsea solutions; and geological storage solutions, including
storage site characterization for carbon dioxide, as well as engages in the
development, management, and environmental protection of water resources.
The company’s Distribution segment markets pipes, valves and valve
automation, fittings, mill and tool supplies, safety products, and artificial
lift systems to the energy and industrial markets.
This segment also provides warehouse management, vendor integration, and
inventory management services.
Schlumberger Limited was founded in 1926 and is based in Houston, Texas.
Last news:
On October 8, 2014, Schlumberger Limited is reportedly looking for a
buyer for its oilfield tools rental unit, Thomas Tools. The unit is valued at
approximately $600 million with annual EBITDA of $80 million.
An auction for the company is currently underway with private-equity
firms reportedly the lead candidates.
Office
of the Foreign Assets Control (OFAC):
The company is not listed on the OFAC list.
The Specially Designated Nationals (SDN) List is a publication of OFAC
which lists individuals and organizations with whom United States citizens and
permanent residents are prohibited from doing business.
EIN: 52-0684746
Staff: 123,000
Operations & branches:
At above address, we find
the corporate headquarters, on lease.
Shareholders:
The Company is listed with the NYSE under symbol SLB.
As of 06-30-2014, 80% of the stock is held by institutional and mutual
fund owners, including:
|
Vanguard Group, Inc. (The) |
4.77% |
|
State Street Corporation |
3.86% |
|
Dodge & Cox Inc |
2.47% |
|
BlackRock Institutional Trust Company, N.A. |
2.34% |
|
FMR, LLC |
2.31% |
|
Bank of New York Mellon Corporation |
2.15% |
Management:
Paal KIBSGAARD, CEO
He has been CEO of Schlumberger Ltd. since August 01, 2011.
Mr. Kibsgaard served as the Chief Operating Officer of Schlumberger Ltd.
from February 2010 to July 2011 and also served as its Group President of
Reservoir Characterization since May 2009 and as Vice President of Personnel
from April 2006 to November 2007. Mr. Kibsgaard served as President of Drilling
& Measurements of Schlumberger Oilfield Services - Technologies (OFS) of
Schlumberger Ltd., since February 2003.
Mr. Kibsgaard was responsible for setting goals, direction and policies
as well as managing the performance of this division within the Schlumberger
Technology Corporation. Mr. Kibsgaard served as the Wireline open hole business
development manager based in Paris, responsible for product development and
market introduction of new technology. In his previous position, Mr. Kibsgaard
was the OFS Geomarket manager for the Caspian Geomarket (CAG). Based in Atyrau,
Kazakhstan, he was responsible for setting up the CAG Geomarket structure and
positioning all the Schlumberger Oilfield Services segments for the exciting
future of Caspian Oil and Gas exploration and development activity. His earlier
assignments included OFS Marketing in Paris and Wireline marketing manager in
Scandinavia, based in Stavanger. He joined Schlumberger as an ID reservoir
engineer in Saudi Arabia in 1997. Prior to this, Mr. Kibsgaard worked for
ExxonMobil, with postings in Norway and Australia. He has been a Director of
Schlumberger Ltd. since April 6, 2011.
He holds a Master's degree in Petroleum Engineering from the Norwegian
Institute of Technology, Trondheim.
Simon AYAT has been the Chief Financial Officer and Executive Vice
President of Schlumberger Limited since March 01, 2007.
Mr. Ayat served as Treasurer and Vice President of Schlumberger Limited
from February 2005 to March 2007 and served as its Controller from December
2002 to February 2005, also served as its Vice President, Business Processes
from December 2002 to February 2005 and served as its Vice President, Finance
from April 2001 to December 2002. Mr. Ayat's 24-year career with Schlumberger
spans a variety of management positions from Paris, Houston and Dallas, to the
Middle East and Far East regions.
He served as a Oilfield Services Controller of Schlumberger Limited,
from September 1998 to April 2001 and served as its GeoMarket Manager Indonesia
from February 1998 to September 1998. He began his career in 1982 as Division
Controller for Forex Neptune.
Mr. Ayat obtained Bachelor of Science degree in Business Administration
with an emphasis on finance and accounting from the University of San
Francisco.
Subsidiaries &
Partnership: Numerous in the U.S. and worldwide.
On attachment:
- 10K 2013
- 3rd 10Q 2014
On October 16, 2014, Schlumberger Limited announced consolidated
earnings results for third quarter and nine months ended September 30, 2014.
For the quarter, the company reported revenue of $12,646 million, income
before taxes of $2,520 million, income from continuing operations of $1,964
million or $1.49 diluted per share, net income attributable to owners of the
company of $1,949 million or $1.49 diluted per share, compared to the revenue
of $11,608 million, income before taxes of $2,231 million, income from
continuing operations of $1,725 million or $1.29 diluted per share, net income
attributable to owners of the company of $1,715 million or $1.29 diluted per
share, for the same quarter a year ago. Free cash flow was $1,833 million and
cash flow from operations were $3,063 million. Pretax operating income in the
third quarter reached $2.8 billion, up 7% sequentially and 12% year-on-year.
For the year to date, the company reported revenue of $35,939 million,
income before taxes of $6,923 million, income from continuing operations of
$5,393 million or $4.07 diluted per share, net income attributable to owners of
the company of $5,136 million or $3.91 diluted per share, capital expenditures
of $2,766 million compared to the revenue of $33,360 million, income before
taxes of $6,521 million, income from continuing operations of $5,160 million or
$3.84 diluted per share, net income attributable to owners of the company of
$5,068 million or $3.79 diluted per share, capital expenditures of $2,753
million for the same period a year ago. Net debt as on September 30, 2013 was
$5,616 million. Cash flow from operations were $7,282 million against $6,571
million a year ago. Free cash flow was $3,735 million against $2,885 million a
year ago. Net debt as on date was $5,845 million against $5,616 million a year
ago.
For 2014, the company expects capex (excluding multiclient and SPM
investments) to be $3.8 billion.
Banks: Citibank
Legal filings & complaints:
As of today date, there are several filings pending with various Courts.
Secured debts summary (UCC):
Several
Trade references:
Date reported: October 2014
High credit: USD 100,000+
Now owing: 0
Past due: 0
Last purchase: September 2014
Line of business: Office supply
Paying status: On terms
Date reported: October 2014
High credit: USD 180,000,000
Now owing: 0
Past due: 0
Last purchase: September 2014
Line of business: Payroll
Paying status: As agreed
Date reported: October 2014
High credit: USD 5,000
Now owing: 0
Past due: 0
Last purchase: September 2014
Line of business: Telecommunications
Paying status: On terms
Domestic credit history:
National Credit Bureaus
gave a satisfying credit rating.
According to our credit analysts, during the last 6 months, domestic
payments were made on due date.
International credit history:
Payments of imports are currently made on beyond terms.
Other comments:
The Company is developing a
strong business worldwide.
The Company is in good
standing.
This means that all local
and federal taxes were paid on due date.
The risk is low.
Our opinion:
A business connection may
be conducted.
Standard & Poor’s
|
United
States of America Long-Term Rating Lowered To 'AA+' Due To Political Risks,
Rising Debt Burden; Outlook Negative |
|
Publication
date: 05-Aug-2011 20:13:14 EST |
·
We have also removed both the short- and long-term ratings
from CreditWatch negative.
·
The downgrade reflects our opinion that the fiscal
consolidation plan that Congress and the Administration recently agreed to
falls short of what, in our view, would be necessary to stabilize the
government's medium-term debt dynamics.
·
More broadly, the downgrade reflects our view that the
effectiveness, stability, and predictability of American policymaking and
political institutions have weakened at a time of ongoing fiscal and economic
challenges to a degree more than we envisioned when we assigned a negative
outlook to the rating on April 18, 2011.
·
Since then, we have changed our view of the difficulties in
bridging the gulf between the political parties over fiscal policy, which makes
us pessimistic about the capacity of Congress and the Administration to be able
to leverage their agreement this week into a broader fiscal consolidation plan
that stabilizes the government's debt dynamics any time soon.
·
The outlook on the long-term rating is negative. We could
lower the long-term rating to 'AA' within the next two years if we see that
less reduction in spending than agreed to, higher interest rates, or new fiscal
pressures during the period result in a higher general government debt
trajectory than we currently assume in our base case.
TORONTO (Standard &
Poor's) Aug. 5, 2011--Standard & Poor's Ratings Services said today that it
lowered its long-term sovereign credit rating on the United States of America
to 'AA+' from 'AAA'. Standard & Poor's also said that the outlook on the
long-term rating is negative. At the same time, Standard & Poor's affirmed
its 'A-1+' short-term rating on the U.S. In addition, Standard & Poor's
removed both ratings from CreditWatch, where they were placed on July 14, 2011,
with negative implications.
The
transfer and convertibility (T&C) assessment of the U.S.--our assessment of
the likelihood of official interference in the ability of U.S.-based public-
and private-sector issuers to secure foreign exchange for
debt service--remains
'AAA'.
We lowered our long-term rating
on the U.S. because we believe that the prolonged controversy over raising the
statutory debt ceiling and the related fiscal policy debate indicate that
further near-term progress containing the growth in public spending, especially
on entitlements, or on reaching an agreement on raising revenues is less likely
than we previously assumed and will remain a contentious and fitful process. We
also believe that the fiscal consolidation plan that Congress and the
Administration agreed to this week falls short of the amount that we believe is
necessary to stabilize the general government debt burden by the middle of the
decade.
Our lowering of the
rating was prompted by our view on the rising public debt burden and our
perception of greater policymaking uncertainty, consistent with our criteria
(see "Sovereign
Government Rating Methodology and Assumptions ," June 30, 2011,
especially Paragraphs 36-41). Nevertheless, we view the U.S. federal
government's other economic, external, and monetary credit attributes, which
form the basis for the sovereign rating, as broadly unchanged.
We have taken the ratings
off CreditWatch because the Aug. 2 passage of the Budget Control Act Amendment
of 2011 has removed any perceived immediate threat of payment default posed by
delays to raising the government's debt ceiling. In addition, we believe that
the act provides sufficient clarity to allow us to evaluate the likely course
of U.S. fiscal policy for the next few years.
The
political brinksmanship of recent months highlights what we see as America's
governance and policymaking becoming less stable, less effective, and less
predictable than what we previously believed. The statutory debt ceiling and
the threat of default have become political bargaining chips in the debate over
fiscal policy. Despite this year's wide-ranging debate, in our view, the
differences between political parties have proven to be extraordinarily
difficult to bridge, and, as we see it, the resulting agreement fell well short
of the comprehensive fiscal consolidation program that some proponents had
envisaged until quite recently. Republicans and Democrats have only been able
to agree to relatively modest savings on discretionary spending while
delegating to the Select Committee decisions on more comprehensive measures. It
appears that for now, new revenues have dropped down on the menu of policy
options. In addition, the plan envisions only minor policy changes on Medicare
and little change in other entitlements,
the containment of which
we and most other independent observers regard as key to long-term fiscal
sustainability.
Our opinion is that
elected officials remain wary of tackling the structural issues required to
effectively address the rising U.S. public debt burden in a manner consistent
with a 'AAA' rating and with 'AAA' rated sovereign peers (see Sovereign
Government Rating Methodology and Assumptions," June 30, 2011,
especially Paragraphs 36-41). In our view, the difficulty in framing a
consensus on fiscal policy weakens the government's ability to manage public
finances and diverts attention from the debate over how to achieve more
balanced and dynamic economic growth in an era of fiscal stringency and
private-sector deleveraging (ibid). A new political consensus might (or might
not) emerge after the 2012 elections, but we believe that by then, the government
debt burden will likely be higher, the needed medium-term fiscal adjustment
potentially greater, and the inflection point on the U.S. population's
demographics and other age-related spending drivers closer at hand (see "Global
Aging 2011: In The U.S., Going Gray Will Likely Cost Even More Green, Now,"
June 21, 2011).
Standard & Poor's
takes no position on the mix of spending and revenue measures that Congress and
the Administration might conclude is appropriate for putting the U.S.'s
finances on a sustainable footing.
The act calls for as much
as $2.4 trillion of reductions in expenditure growth over the 10 years through 2021.
These cuts will be implemented in two steps: the $917 billion agreed to
initially, followed by an additional $1.5 trillion that the newly formed
Congressional Joint Select Committee on Deficit Reduction is supposed to
recommend by November 2011. The act contains no measures to raise taxes or
otherwise enhance revenues, though the committee could recommend them.
The act further provides
that if Congress does not enact the committee's recommendations, cuts of $1.2
trillion will be implemented over the same time period. The reductions would
mainly affect outlays for civilian discretionary spending, defense, and
Medicare. We understand that this fall-back mechanism is designed to encourage
Congress to embrace a more balanced mix of expenditure savings, as the
committee might recommend.
We note that in a letter
to Congress on Aug. 1, 2011, the Congressional Budget Office (CBO) estimated
total budgetary savings under the act to be at least $2.1 trillion over the
next 10 years relative to its baseline assumptions. In updating our own fiscal
projections, with certain modifications outlined below, we have relied on the
CBO's latest "Alternate Fiscal Scenario" of June 2011, updated to
include the CBO assumptions contained in its Aug. 1 letter to Congress. In general,
the CBO's "Alternate Fiscal Scenario" assumes a continuation of
recent Congressional action overriding existing law.
We view the act's
measures as a step toward fiscal consolidation. However, this is within the
framework of a legislative mechanism that leaves open the details of what is
finally agreed to until the end of 2011, and Congress and the Administration
could modify any agreement in the future. Even assuming that at least $2.1
trillion of the spending reductions the act envisages are implemented, we
maintain our view that the U.S. net general government debt burden (all levels
of government combined, excluding liquid financial assets) will likely continue
to grow. Under our revised base case fiscal scenario--which we consider to be
consistent with a 'AA+' long-term rating and a negative outlook--we now project
that net general government debt would rise from an estimated 74% of GDP by the
end of 2011 to 79% in 2015 and 85% by 2021. Even the projected 2015 ratio of
sovereign indebtedness is high in relation to those of peer credits and, as
noted, would continue to rise under the act's revised policy settings.
Compared with previous
projections, our revised base case scenario now assumes that the 2001 and 2003
tax cuts, due to expire by the end of 2012, remain in place. We have changed
our assumption on this because the majority of Republicans in Congress continue
to resist any measure that would raise revenues, a position we believe Congress
reinforced by passing the act. Key macroeconomic assumptions in the base case
scenario include trend real GDP growth of 3% and consumer price inflation near
2% annually over the decade.
Our revised upside
scenario--which, other things being equal, we view as consistent with the
outlook on the 'AA+' long-term rating being revised to stable--retains these
same macroeconomic assumptions. In addition, it incorporates $950 billion of
new revenues on the assumption that the 2001 and 2003 tax cuts for high earners
lapse from 2013 onwards, as the Administration is advocating. In this scenario,
we project that the net general government debt would rise from an estimated
74% of GDP by the end of 2011 to 77% in 2015 and to 78% by 2021.
Our revised downside
scenario--which, other things being equal, we view as being consistent with a
possible further downgrade to a 'AA' long-term rating--features less-favorable
macroeconomic assumptions, as outlined below and also assumes that the second
round of spending cuts (at least $1.2 trillion) that the act calls for does not
occur. This scenario also assumes somewhat higher nominal interest rates for
U.S. Treasuries. We still believe that the role of the U.S. dollar as the key
reserve currency confers a government funding advantage, one that could change
only slowly over time, and that Fed policy might lean toward continued loose
monetary policy at a time of fiscal tightening. Nonetheless, it is possible
that interest rates could rise if investors re-price relative risks. As a
result, our alternate scenario factors in a 50 basis point (bp)-75 bp rise in
10-year bond yields relative to the base and upside cases from 2013 onwards. In
this scenario, we project the net public debt burden would rise from 74% of GDP
in 2011 to 90% in 2015 and to 101% by 2021.
Our revised scenarios
also take into account the significant negative revisions to historical GDP
data that the Bureau of Economic Analysis announced on July 29. From our
perspective, the effect of these revisions underscores two related points when
evaluating the likely debt trajectory of the U.S. government. First, the
revisions show that the recent recession was deeper than previously assumed, so
the GDP this year is lower than previously thought in both nominal and real
terms. Consequently, the debt burden is slightly higher. Second, the revised
data highlight the sub-par path of the current economic recovery when compared
with rebounds following previous post-war recessions. We believe the sluggish
pace of the current economic recovery could be consistent with the experiences
of countries that have had financial crises in which the slow process of debt
deleveraging in the private sector leads to a persistent drag on demand. As a
result, our downside case scenario assumes relatively modest real trend GDP
growth of 2.5% and inflation of near 1.5% annually going forward.
When comparing the U.S.
to sovereigns with 'AAA' long-term ratings that we view as relevant
peers--Canada, France, Germany, and the U.K.--we also observe, based on our
base case scenarios for each, that the trajectory of the U.S.'s net public debt
is diverging from the others. Including the U.S., we estimate that these five
sovereigns will have net general government debt to GDP ratios this year
ranging from 34% (Canada) to 80% (the U.K.), with the U.S. debt burden at 74%.
By 2015, we project that their net public debt to GDP ratios will range between
30% (lowest, Canada) and 83% (highest, France), with the U.S. debt burden at
79%. However, in contrast with the U.S., we project that the net public debt
burdens of these other sovereigns will begin to decline, either before or by
2015.
Standard & Poor's
transfer T&C assessment of the U.S. remains 'AAA'. Our T&C assessment
reflects our view of the likelihood of the sovereign restricting other public
and private issuers' access to foreign exchange needed to meet debt service.
Although in our view the credit standing of the U.S. government has
deteriorated modestly, we see little indication that official interference of
this kind is entering onto the policy agenda of either Congress or the
Administration. Consequently, we continue to view this risk as being highly
remote.
The outlook on the
long-term rating is negative. As our downside alternate fiscal scenario
illustrates, a higher public debt trajectory than we currently assume could
lead us to lower the long-term rating again. On the other hand, as our upside
scenario highlights, if the recommendations of the Congressional Joint Select
Committee on Deficit Reduction--independently or coupled with other
initiatives, such as the lapsing of the 2001 and 2003 tax cuts for high
earners--lead to fiscal consolidation measures beyond the minimum mandated, and
we believe they are likely to slow the deterioration of the government's debt
dynamics, the long-term rating could stabilize at 'AA+'.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.61.41 |
|
|
1 |
Rs.98.06 |
|
Euro |
1 |
Rs.76.67 |
INFORMATION DETAILS
|
Analysis Done by
: |
DIV |
|
|
|
|
Report Prepared
by : |
SMN |
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%)
This report is issued at your request without any
risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL)
or its officials.