MIRA
INFORM REPORT
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Report Date : |
03.09.2014 |
IDENTIFICATION DETAILS
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Name : |
Weiqiao Textile Company Limited |
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Registered Office : |
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Country : |
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Financials (as on) : |
31.12.2013 |
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Date of Incorporation : |
06.12.1999 |
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Com. Reg. No.: |
370000018046763 |
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Legal Form : |
Shares Limited Company |
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Line of Business : |
Engaged in manufacturing and selling cotton yarn, grey fabric and
denim. |
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No. of Employees : |
84,000 |
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 : |
Good |
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Payment Behaviour : |
Regular |
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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 01, 2014
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Country Name |
Previous Rating (31.03.2014) |
Current Rating (01.06.2014) |
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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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Moderate Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderate 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
Weiqiao Textile Company Limited
NO. 1
WEIFANG ROAD, ECONOMIC DEVELOPMENT ZONE,
ZOUPING
COUNTY, SHANDONG PROVINCE, 256200 PR CHINA
TEL: 86
(0) 543-4161171 FAX: 86 (0) 543-4162000
EXECUTIVE SUMMARY
INCORPORATION DATE :
DEC. 6, 1999
REGISTRATION NO. :
370000018046763
REGISTERED LEGAL FORM : SHARES LIMITED COMPANY
STAFF STRENGTH :
84,000 (INCLUDING EMPLOYEES OF ITS SUBSIDIARIES)
REGISTERED CAPITAL : CNY 1,194,389,000
BUSINESS LINE :
MANUFACTURING & TRADING
REVENUE :
CNY 13,880,642,000 (CONSOLIDATED, AS OF DEC. 31, 2013)
TOTAL EQUITY : CNY 16,101,848,000 (CONSOLIDATED,
AS OF DEC. 31, 2013)
PAYMENT :
AVERAGE
MARKET CONDITION :
COMPETITIVE
FINANCIAL CONDITION : FAIRLY STABLE
OPERATIONAL TREND : STEADY
GENERAL REPUTATION :
WELL-KNOWN
EXCHANGE RATE :
CNY 6.1474= 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
SC was registered as a shares
limited company at provincial Administration for Industry & Commerce (AIC -
The official body of issuing and renewing business license) on Dec. 6, 1999.
Company Status: Shares limited co. This
form of business in PR China is defined as a legal person. Its registered capital
is divided into shares of equal par value and the co. raises capital by
issuing share certificates by promotion or by public offer. Shareholders
bear limited liability to the extent of shareholding, and the co. is liable
for its debts only to the extent of its total assets. The co has
independent property of legal person and enjoys property rights of legal
person. The characteristics of the shares limited co. are as follows: The
establishment of the co. requires at least two promoters and no more than
200, half of whom shall be domiciled in The
minimum registered capital of a co. is CNY The
board of directors must consist of five to nineteen directors. If the co. raises
capital by public offer, the promoters must not subscribe less than 35% of
the total shares. the promoters’ shares are restricted to transfer- within
one year of the offer. A
state-owned enterprise that is restructured into a shares limited co. must
comply with the conditions & requirements specified under the law &
administrative rule.
SC’s registered business
scope includes processing cotton; manufacturing, processing and selling cotton
spinning, weave cloth, printing and dying, knitting, garments; importing and
exporting in permit scope; selling cotton.
SC is mainly engaged in manufacturing and selling cotton yarn, grey
fabric and denim.
Ms.
Zhang Hongxia is legal representative,
chairman and general manager of SC at present.
SC and its subsidiaries are known to have approx. 84,000 employees at present.
SC is currently operating at the above stated address, and this
address houses its operating office and factory in the development zone of
Zouping County. Our checks reveal that SC owns the total premise, but SC’s
accountant refused to release the gross area.
http://www.wqfz.com The design is
professional and the content is well organized. At present it is both in
Chinese and English versions.
Email: zhangjinglei@wqfz.com
SC is a listed
company in Hong Kong Stock Exchange Market with the code of 02698.
Subject passed the annual inspection of 2012
with Administration for Industry & Commerce.
Organization Code: 720714466
Tax No.: 372330720714466
Ø
SC is the largest cotton textile manufacturer in
the world and one of top-500 enterprises of China and one of top-14 super-large
enterprises of Shandong province in 2013
Ø
SC's combed yarn recognized by AQSIQ as "China
Brandname Products"
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SC's grey fabric recognized by AQSIQ as "China
Brandname Products"
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SC's knitting yarn recognized by China Cotton
Textile Association and China Knitting Industry Association as high credit
product by users
Ø
SC's production the "Riverside Scene at
Qingming Festival" won it a patent for exterior design from National
Intellectual Property Rights Organization
Changes of its registered information:
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Date of change |
Item |
Before the change |
After the change |
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Company’s name |
Present one |
For the past two years there is no record of litigation.
MAIN SHAREHOLDERS: (As of Dec. 31 2013)
Name %
of Shareholding
Brandes Investment Partners,
L.P. 6.26
Mellon Financial Corporation 3.44
Zhang Hongxia 1.48
Zhang Shiping
0.44
Other Shareholders 24.93
*Shandong Weiqiao Pioneering
Group Co., Ltd.
=========================================================
Shandong Weiqiao Pioneering
Group Co., Ltd. is located at the southern end of Lubei plain, closely
adjoining Jiaozhou-Jinan Railway and Jinan-Qingdao Expressway. The company has
become a super-large enterprise that focuses on providing goods and integrated
service of textile, dyeing and finishing, garment, home textile, heat
electricity, aluminum industry, salt chemical industry and new materials with
the total assets of RMB 126.9 billion Yuan and eight production bases. With its
first-class equipments, productive capacity and economic benefit, Weiqiao
Pioneering Group ranked No
Shandong Weiqiao Pioneering
Group Company Ltd. has been awarded ‘National May 1 labor medal’ in 1997,
‘National advanced unit in building of spiritual civilization’ in 1999,
‘National advanced Party organization at primary level’ in 2006, ‘Home for
national working models’ in 2010 and ‘National advanced group of textile
industry system’ for many times, ‘National economic benefits vanguard in cotton
textile industry field’ during year 1998-2011, ‘National advanced unit of
textile harmonious enterprise construction’ in 2006, ‘Chinese ten brand textile
cultural enterprise’ in 2010 and ‘National textile industry industrialized
& informationized fusion model enterprise’ in 2011.
Reg. No.: 371626018002430
Legal representative: Zhang
Shiping
Incorporation date: April 14,
1998
Address: No. 1 Weifang Road,
Zouping Economic Development Zone, Shandong China
Zip: 256200
Tel: 0543-4161111
Fax: 0543-4161188
Website: www.weiqiaocy.com
Email: wqcy@wqfz.com
l
Legal representative, chairman and general
manager:
Ms. Zhang Hongxia, born in 1971, MBA. She is currently
responsible for the overall management of SC.
Working Experience(s):
At present Working
in SC as chairman, legal representative and general manager.
Also working in Shandong Luteng Textile Company
Limited, Shandong Binteng Textile
Company Limited, and Weihai Weiqiao Textile Co., Ltd., etc. as legal
representative
Executive Directors
Zhang Yanhong
Zhao Suwen
Zhang Jinglei
Non-Executive Directors
Zhang Shiping
Zhao Suhua
Independent Directors
Wang Naixin
Xu Wenying
Chan Wing Yau, George
Supervisors
Wang Xiaoyun
Wang Wei
SC is mainly engaged
in manufacturing and selling cotton yarn, grey fabric and denim.
Main Products:
Cotton Yarn
Grey Fabric
Denim
In 2013, SC produced
approximately produced approximately 488,000 tonnes of cotton yarn,
1,021,000,000 meters of grey fabric and 73,000,000 meters of denim.
SC sources its materials 80%
from domestic market, and 20% from overseas market. SC sells 50% of its
products in domestic market, and 50% to overseas market
Trademark & Patents
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Registration No. |
6991391 |
6052883 |
4677708 |
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Registration Date |
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Trademark Design |
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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, L/C and Credit of 30-60
days.
*Major
Customers:
==============
Tai Dong Nan Import-Export Trading
Ningbo Junan Resources Co., Ltd.
Solid Gold Logistics (H.K.) Ltd.
Olly Hwa (Holdings) Limited
Billion Chance Trading Limited
*Major
Suppliers:
==============
China National Cotton Reserves Corporation
Louis Dreyfus
Cashcot Industries Pte. Ltd.
HongKong Ruilong International Trading Co., Limited
Xinjiang Yinlong International Agricultural
Cooperation Co., Ltd.
SC is known to have the following subsidiaries:
Weihai
Weiqiao Textile Co., Ltd.
Binzhou Weiqiao Technology Industrial
Park Co., Ltd.
Shandong Luteng Textile Company Limited
Weihai Weiqiao Industrial Park Co., Ltd.
Shandong Binteng Textile Company Limited
Weiqiao Textile (HongKong) Trading Co., Limited
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’s suppliers
refused to make any comment.
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.
Consolidated
Balance Sheet
Unit: CNY’000
|
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As
of Dec. 31, 2013 |
As
of Dec. 31, 2012 |
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Property, plant and equipment |
13,662,949 |
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Lease prepayments |
181,220 |
185,791 |
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Other intangible assets |
950 |
1,109 |
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Investments in associated companies and jointly controlled entities |
74,014 |
51,067 |
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Other non-current assets |
0 |
0 |
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Deferred tax assets |
212,542 |
263,044 |
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------------------ |
------------------ |
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Non-Current assets |
12,799,086 |
14,163,960 |
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------------------ |
------------------ |
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Inventory |
6,439,476 |
5,799,515 |
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Trade receivables |
547,228 |
548,475 |
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Advance to supplier, margin & other receivable |
155,362 |
119,249 |
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Account receivable from directly holding companies |
12,203 |
8,312 |
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Mortgage term deposits |
141,963 |
243,598 |
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Time deposits
with original maturity of more than three months |
0 |
120,332 |
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Cash & Cash
Equivalents |
10,210,689 |
7,349,732 |
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Other current
assets |
4,455 |
20,496 |
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------------------ |
------------------ |
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Current assets |
17,511,376 |
14,209,709 |
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=========== |
=========== |
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Total assets |
30,310,462 |
28,373,669 |
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=========== |
=========== |
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Trade payable |
2,049,803 |
1,935,893 |
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Other payable to
associated companies |
5,686 |
5,670 |
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Other payable
and accrued account |
944,931 |
1,033,245 |
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Derivate
financial instrument |
0 |
3,236 |
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Interest-bearing
bank loans & other loans |
3,708,361 |
4,460,927 |
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Deferred income |
40,267 |
41,538 |
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Taxes payable |
460,337 |
357,085 |
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------------------ |
------------------ |
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Current
liabilities |
7,209,385 |
7,837,594 |
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------------------ |
------------------ |
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Non-current
liabilities |
6,999,229 |
4,892,201 |
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------------------ |
------------------ |
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Total
liabilities |
14,208,614 |
12,729,795 |
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Equities |
16,101,848 |
15,643,874 |
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|
------------------ |
------------------ |
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Total
liabilities & equities |
30,310,462 |
28,373,669 |
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============= |
============= |
Consolidated
Income Statement
Unit: CNY’000
|
|
As of Dec. 31,
2013 |
As of Dec. 31,
2012 |
|
Turnover |
13,880,642 |
15,247,956 |
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Cost of goods sold |
12,675,012 |
14,210,749 |
|
Incomes from
other operations |
865,350 |
794,410 |
|
Sales and marketing expenses |
204,199 |
206,211 |
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Administrative expenses |
283,578 |
252,398 |
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Other expenses |
99,265 |
84,216 |
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Financial expenses |
566,439 |
628,886 |
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Share of profits
of associates |
4,276 |
3,835 |
|
Profit before
tax |
921,775 |
663,741 |
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Less: profit tax |
294,857 |
184,752 |
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Profits |
626,918 |
478,989 |
Important
Ratios
=============
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As
of Dec. 31, 2013 |
As
of Dec. 31, 2012 |
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*Current ratio |
2.43 |
1.81 |
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*Quick ratio |
1.54 |
1.07 |
|
*Liabilities
to assets |
0.47 |
0.45 |
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*Net profit margin
(%) |
4.52 |
3.14 |
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*Return on
total assets (%) |
2.07 |
1.69 |
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*Inventory
/Turnover ×365 |
169 days |
139 days |
|
*Accounts
receivable/Turnover ×365 |
/ |
/ |
|
*Turnover/Total
assets |
0.46 |
0.54 |
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* Cost of
goods sold/Turnover |
0.91 |
0.93 |
PROFITABILITY:
FAIRLY GOOD
l
The turnover of SC appears good in its
line, but decreased in 2013.
l
SC’s net profit margin is average in
both years.
l
SC’s return on total assets is average
in both years.
l
SC’s cost of goods sold is average in
both years, comparing with its turnover.
LIQUIDITY:
AVERAGE
l
The current ratio of SC is maintained
in a normal level in 2012 and fairly good in 2013.
l
SC’s quick ratio is maintained in a
normal level in both years.
l
The inventory
of SC appears fairly large in both years.
l
SC’s turnover is in a fair level,
comparing with the size of its total assets.
LEVERAGE:
FAIRLY GOOD
l
The debt ratio of SC is low.
l
The risk for SC to go bankrupt is low.
Overall
financial condition of the SC: Fairly Stable
SC is considered large-sized in its line with fairly stable financial
conditions. The fairly large amount of
inventory would be a threat to SC’s financial conditions. Taking into
consideration of SC’s general performance and operation size, we would rate SC
as a low risk company.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.60.61 |
|
|
1 |
Rs.100.48 |
|
Euro |
1 |
Rs.79.56 |
INFORMATION DETAILS
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Analysis Done by
: |
DIV |
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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 |
|
|
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 |
|
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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.