MIRA
INFORM REPORT
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Report Date : |
09.10.2014 |
IDENTIFICATION DETAILS
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Name : |
THE JAPAN STEEL WORKS LTD |
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Registered Office : |
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Country : |
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Financials (as on) : |
31.03.2014 |
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Date of Incorporation : |
December, 1950 |
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Com. Reg. No.: |
0107-01-019531 (Tokyo-Shinagawaku) |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
Manufacturer of Plastics Machines, Steel Castings & Forgings. |
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No. of Employees : |
4,754 |
RATING & COMMENTS
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MIRA’s Rating : |
Ba |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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41-55 |
Ba |
Overall operation is considered normal. Capable to meet normal
commitments. |
Satisfactory |
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Status : |
Satisfactory |
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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 – June 1, 2014
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Country Name |
Previous Rating (31.03.2014) |
Current Rating (01.06.2014) |
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Japan |
A1 |
A1 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low |
A2 |
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Moderate |
B1 |
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High |
B2 |
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Very High |
C1 |
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Restricted |
C2 |
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Off-credit |
D |
JAPAN - ECONOMIC OVERVIEW
In the years following World
War II, government-industry cooperation, a strong work ethic, mastery of high
technology, and a comparatively small defense allocation (1% of GDP) helped
Japan develop a technologically advanced economy. Two notable characteristics
of the post-war economy were the close interlocking structures of
manufacturers, suppliers, and distributors, known as keiretsu, and the
guarantee of lifetime employment for a substantial portion of the urban labor
force. Both features are now eroding under the dual pressures of global
competition and domestic demographic change. Japan's industrial sector is
heavily dependent on imported raw materials and fuels. A small agricultural
sector is highly subsidized and protected, with crop yields among the highest
in the world. While self-sufficient in rice production, Japan imports about 60%
of its food on a caloric basis. For three decades, overall real economic growth
had been spectacular - a 10% average in the 1960s, a 5% average in the 1970s,
and a 4% average in the 1980s. Growth slowed markedly in the 1990s, averaging
just 1.7%, largely because of the after effects of inefficient investment and
an asset price bubble in the late 1980s that required a protracted period of
time for firms to reduce excess debt, capital, and labor. Modest economic
growth continued after 2000, but the economy has fallen into recession three
times since 2008. A sharp downturn in business investment and global demand for
Japan's exports in late 2008 pushed Japan into recession. Government stimulus
spending helped the economy recover in late 2009 and 2010, but the economy
contracted again in 2011 as the massive 9.0 magnitude earthquake and the
ensuing tsunami in March disrupted manufacturing. The economy has largely
recovered in the two years since the disaster, but reconstruction in the Tohoku
region has been uneven. Prime Minister Shinzo ABE has declared the economy his
government's top priority; he has overturned his predecessor's plan to
permanently close nuclear power plants and is pursuing an economic
revitalization agenda of fiscal stimulus, monetary easing, and structural
reform. Japan joined the Trans Pacific Partnership negotiations in 2013, a pact
that would open Japan's economy to increased foreign competition and create new
export opportunities for Japanese businesses. Measured on a purchasing power
parity (PPP) basis that adjusts for price differences, Japan in 2013 stood as
the fourth-largest economy in the world after second-place China, which
surpassed Japan in 2001, and third-place India, which edged out Japan in 2012.
The new government will continue a longstanding debate on restructuring the
economy and reining in Japan's huge government debt, which is exceeding 230% of
GDP. To help raise government revenue and reduce public debt, Japan decided in
2013 to gradually increase the consumption tax to a total of 10% by the year
2015. Japan is making progress on ending deflation due to a weaker yen and
higher energy costs, but reliance on exports to drive growth and an aging,
shrinking population pose other major long-term challenges for the economy.
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Source
: CIA |
Company Name and Address
THE JAPAN STEEL WORKS LTD
REGD NAME: Nihon
Seikosho KK
MAIN OFFICE:
Tel:
03-5745-2001 Fax: 03-5745-2025
E-Mail address: info_steel_forging@jsw.co.jp
ACTIVITIES
Mfg of plastics
machines, steel castings & forgings
BRANCHES
Osaka, Nagoya,
Shizuoka, Fukuoka, Sapporo, other (Tot 21)
OVERSEAS
USA, India, China, Singapore, Indonesia, Philippines, Thailand, Malaysia,
Hong Kong, Taiwan (21 locations)
FACTORIES
Muroran,
Hiroshima, Yokohama
CHIEF EXEC
IKUO SATO, PRES
Yen Amount: In million Yen, unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 188,719 M
PAYMENTSNO
COMPLAINTS CAPITAL Yen 19,694 M
TREND SLOW WORTH Yen 139,268 M
STARTED 1950 EMPLOYES 4,754
COMMENT
MFR OF PLASTIC MACHINES, LARGE STEEL CASTINGS & FORGING.
FINANCIAL SITUATION COSIDERED FAIR AND GOOD
FOR ORDINARY BUSINESS ENGAGEMENTS.
Notes: Unit: In Million Yen
Forecast
(or estimated) figures for 31/03/2015 fiscal term
HIGHLIGHTS
The subject
company is one of world’s leading mfrs of plastic machines and large steel
castings & forging bound for electric power & general plants. Renowned for resin machinery. Ranked in 2nd group in the field
of injection machines in Japan. Also
makes defense equipment including guns, tanks, missile launchers &
antiaircraft gun systems. French nuclear
firm, Areva, acquired 1.3% stake in the subject firm and signed a long term purchase
contract for large forged-steel parts for nuclear power plants, reported in Nov
2008. The long term contract likely
covers the purchasing of forged-steel parts for 20 or more nuclear reactors
between 2012 & 2016, as reported.
Partially amending capacity investment plan for Muroran plant, with
focus put on enhancing output of N-power materials to address abundant order
backlog. The company intends to boost
new demand for forges & foundries from other sectors than N-power plants
and with the development of offshore wind power systems and large wind mills
and tie-up with overseas. It also aims
to boost sales of excimer laser annealing equipment for high resolution LCDs
and organic ELs.
FINANCIAL INFORMATION
The sales volume for Mar/2014 fiscal term amounted to Yen 188,719
million, a 14.5% down from Yen 220,653 million in the previous term. This is referred to slumping new orders from
thermal and N-power plants. Export of
resin finishing machines to China declined.
The recurring profit was posted at Yen 9,704 million and the net profit
at Yen 5,527 million, respectively, compared with Yen 17,108 million recurring
profit and Yen 8,281 million net profit, respectively, a year ago.
(Apr/Jun/2014 results): Sales Yen 39,480
million (down 4.5%), operating profit Yen 385 million (down 68.8%), recurring
profit Yen 739 million (down 60.9%), net profit Yen 491 million (down
60.3%). (% as compared with the
corresponding period a year ago).
For the current
term ending Mar 2015 the recurring profit is projected at Yen 10,000 million
and the net profit at Yen 6,000 million, on a 6% up in turnover, to Yen 200,000
million. Operating profit will surge, on
recovery in equipment for power plants and continuing surge in injection
molding machines.
The financial
situation is considered FAIR and good for ORDINARY business engagements.
REGISTRATION
Date
Registered: Dec 1950
Regd
No.: 0107-01-019531
(Tokyo-Shinagawaku)
Legal Status: Limited
Company (Kabushiki Kaisha)
Authorized: 1,000
million shares
Issued: 371,463,036
shares
Sum: Yen
19,694 million
Major
shareholders (%): Master Trust Bank of Japan T (5.5), Japan Trustee Services Bank (5.0),
Mitsui Life Ins (3.8), SMBC (3.3), Mitsui Sumitomo Ins (2.3), Sumitomo Mitsui
Trust Bank (2.1), Juniper (2.1), Nippon Steel & Sumitomo Metal (1.7),
Hitachi Ltd (1.3), Mitsubishi Heavy Ind (1.3); foreign owners (22.8)
No.
of shareholders: 29,496
Listed on the S/Exchange (s) of: Tokyo, Nagoya,
Fukuoka, Sapporo
Managements: Ikuo Sato, pres;
Yoshitomo Tanaka, v pres; Yutaka Mizutani, s/mgn dir; Akira Kadota, mgn dir;
Nobuaki Shimizu, mgn dir; Kenji Watanabe, dir; Yutaka Higashiizumi, dir;
Motonobu Sato, dir
Nothing
detrimental is known as to the commercial morality of executives.
Related companies: Nikko Trading, Nikko Tokki, Nikko Techno,
other
OPERATION
Activities: Manufactures
plastic machines and large casting & forgings bound for electric power and
general plants:
(Sales
breakdown by Divisions):
Steel
Product-related (36%): steel forgings & castings, clad steel products,
pressure vessel;
Machinery-related
(63%): magnesium process equipment & products, injection molding machine,
polyolefin extruders, auto screen changer, compounding extruders, microcellular
foam processing technology, reciprocating compressors labyrinth piston type,
film & sheet production systems;
Regional
Development-related (1%): wind turbine system, commercial building
development, Fuchu intelligent park, shopping center, other;
Overseas
sales ratio (53%)
Clients: [Mfrs,
wholesalers] Marubeni-Itochu Steel Inc, Mitsui & Co, JSW Plastics, Nikko
Trading, Nikko Techno, Yodogawa Steel Works, Ministry of Self Defense,
Mitsubishi Heavy Ind, Toshiba Corp, Sumitomo Corp, Mitsui Bussan Plant Systems,
other
No. of accounts:
1,000
Domestic areas of
activities: Nationwide
Suppliers: [Mfrs,
wholesalers] Mitsui & Co Steel Ltd, Allegheny Technologies Japan, Coherent
Japan Inc, Shibaura Iron Works, Tanaka Electric Ind, Tetsugen Corp, other.
Payment record: No Complaints
Location: Business area in Tokyo.
Office premises at the caption address are leased and maintained
satisfactorily.
Bank References:
SMBC (H/O)
Mizuho Bank (Tokyo)
Relations: Satisfactory
FINANCES
(In Million Yen)
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FINANCES: (Consolidated
in million yen) |
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Terms Ending: |
31/03/2014 |
31/03/2013 |
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INCOME STATEMENT |
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Annual Sales |
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188,719 |
220,653 |
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Cost of Sales |
153,137 |
176,172 |
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GROSS PROFIT |
35,581 |
44,480 |
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Selling & Adm Costs |
26,717 |
27,799 |
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OPERATING PROFIT |
8,864 |
16,680 |
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Non-Operating P/L |
840 |
428 |
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RECURRING PROFIT |
9,704 |
17,108 |
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NET PROFIT |
5,527 |
8,281 |
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BALANCE SHEET |
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Cash |
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42,329 |
51,005 |
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Receivables |
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48,869 |
51,970 |
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Inventory |
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79,903 |
59,514 |
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Securities, Marketable |
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Other Current Assets |
(3,625) |
11,535 |
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TOTAL CURRENT ASSETS |
167,476 |
174,024 |
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Property & Equipment |
85,672 |
94,476 |
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Intangibles |
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855 |
789 |
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Investments, Other Fixed Assets |
39,136 |
34,681 |
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TOTAL ASSETS |
293,139 |
303,970 |
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Payables |
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42,339 |
42,216 |
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Short-Term Bank Loans |
12,292 |
12,703 |
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Other Current Liabs |
44,217 |
56,377 |
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TOTAL CURRENT LIABS |
98,848 |
111,296 |
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Debentures |
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10,000 |
10,000 |
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Long-Term Bank Loans |
15,095 |
17,805 |
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Reserve for Retirement Allw |
10,405 |
9,419 |
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Other Debts |
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19,522 |
21,081 |
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TOTAL LIABILITIES |
153,870 |
169,601 |
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MINORITY INTERESTS |
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Common
stock |
19,694 |
19,694 |
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Additional
paid-in capital |
5,425 |
5,425 |
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Retained
earnings |
110,635 |
107,861 |
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Evaluation
p/l on investments/securities |
4,293 |
1,475 |
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Others |
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(49) |
326 |
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Treasury
stock, at cost |
(730) |
(413) |
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TOTAL S/HOLDERS` EQUITY |
139,268 |
134,368 |
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TOTAL EQUITIES |
293,139 |
303,970 |
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CONSOLIDATED CASH FLOWS |
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Terms ending: |
31/03/2014 |
31/03/2013 |
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Cash
Flows from Operating Activities |
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11,549 |
23,735 |
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Cash
Flows from Investment Activities |
-5,719 |
-5,832 |
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Cash
Flows from Financing Activities |
-15,007 |
-15,259 |
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Cash,
Bank Deposits at the Term End |
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42,297 |
50,972 |
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ANALYTICAL RATIOS Terms ending: |
31/03/2014 |
31/03/2013 |
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Net
Worth (S/Holders' Equity) |
139,268 |
134,368 |
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Current
Ratio (%) |
169.43 |
156.36 |
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Net
Worth Ratio (%) |
47.51 |
44.20 |
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Recurring
Profit Ratio (%) |
5.14 |
7.75 |
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Net
Profit Ratio (%) |
2.93 |
3.75 |
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Return
On Equity (%) |
3.97 |
6.16 |
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
Rs.61.46 |
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1 |
Rs.98.77 |
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Euro |
1 |
Rs.77.65 |
INFORMATION DETAILS
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Analysis Done by
: |
KAR |
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Report Prepared
by : |
NIT |
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.