MIRA
INFORM REPORT
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Report Date : |
20.09.2014 |
IDENTIFICATION DETAILS
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Name : |
FUJIAN LONGKING CO., LTD. |
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Registered Office : |
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Country : |
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Financials (as on) : |
30.06.2014 |
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Date of Incorporation : |
23.02.1988 |
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Com. Reg. No.: |
350000100018216 |
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Legal Form : |
Shares Limited Co. |
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Line of Business : |
Engaged in designing,
manufacturing, installing and selling environmental protection equipment. |
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No. of Employees : |
5,423 (Including Subsidiaries) |
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
|
Country Name |
Previous Rating (31.03.2014) |
Current Rating (01.06.2014) |
|
China |
A2 |
A2 |
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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 |
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
FUJIAN LONGKING CO., LTD.
NO. 81 LINGYUAN ROAD, XINLUO
DISTRICT, LONGYAN CITY,
FUJIAN PROVINCE, 364000 PR CHINA
TEL: 86 (0) 597-2210288 FAX: 86 (0) 597-2290903
EXECUTIVE SUMMARY
INCORPORATION DATE :
FEB. 23, 1998
REGISTRATION NO. :
350000100018216
REGISTERED LEGAL FORM :
SHARES LIMITED CO.
CHIEF EXECUTIVE :
MR. ZHOU SUHUA (CHAIRMAN)
STAFF STRENGTH :
5,423 (INCLUDING SUBSIDIARIES)
REGISTERED CAPITAL : CNY 427,620,000
BUSINESS LINE :
DESIGNING, MANUFACTURING, INSTALLING & TRADING
TURNOVER :
CNY 2,262,192,000 (CONSOLIDATED, JAN. 1 TO JUNE 30, 2014)
EQUITIES : CNY 2,985,095,000
(CONSOLIDATED, AS OF JUNE 30, 2014)
PAYMENT :
AVERAGE
MARKET CONDITION :
COMPETITIVE
FINANCIAL CONDITION : FAIRLY STABLE
OPERATIONAL TREND : STEADY
GENERAL REPUTATION :
AVERAGE
EXCHANGE RATE :
CNY 6.1395= 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 co. at local
Administration for Industry & Commerce (AIC - The official body of issuing
and renewing business license) on Feb. 23, 1998.
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 designing, manufacturing,
selling, installing, testing environmental pollution control equipment and
conveying equipment; operating other items with permit. (with permit if needed)
Mr.
Zhou Suhua is the legal representative and chairman of SC at present.
SC is
known to have approx. 5,423 employees (including subsidiaries) at present,
including 2,451 producing staff, 370 sale staff, 1,780 technicians, 142 financial
staff and 680 administration staff.
SC is
currently operating at the above stated address, and this address houses its
operating office and factory in the industrial zone of Longyan. The detailed
information of the area is unspecified.
www.longking.com.cn
The
design is professional and the content is well organized. At present it is in
Chinese and English versions.
E-Mail: stock@longking.com.cn
SC is a listed company in Shanghai Stock Exchange with the
code of 600388 on Dec. 29, 2000.
|
Date of change |
Item |
Before the
change |
After the change |
|
2000 |
Company’s Chinese name |
|
Present one |
Note: SC
changed its Chinese name with the same English name.
Subject passed the annual inspection of 2012
with Administration for Industry & Commerce.
Organization code: 705317155
See below for SC as executive party (defendant).
|
Executed
Party |
SC |
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Court |
Longyan City Intermediate People's Court |
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Date of Case |
|
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Case
Number |
(2014) 00001 |
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Claim Amount |
RMB 555,758 |
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Case Status |
Completed |
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Executed
Party |
SC |
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Court |
Ji’nan City Huaiyin District People's Court |
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Date of Case |
|
|
Case
Number |
(2010) 00096 |
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Claim Amount |
RMB 499,938 |
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Case Status |
Completed |
Remark: Due to the lack of information, we are
unable to provide the cause of action, judgment or other information.
MAIN SHAREHOLDERS: (As of June 30, 2014)
Name %
of Shareholding
Fujian Dongzheng Investment Co., Ltd.
(literal translation) 17.17
Longyan State-own Assets Investment
& Operation Co., Ltd. (literal translation) 8.63
Longhai Tengju Commercial & Trade
Co., Ltd. (literal translation) 0.87
Longyan Electric Power Construction
Development Corp. (literal translation) 0.79
Longyan Hairun Investment Co., Ltd.
(literal translation) 0.79
Jilin Sihai Grain & Oil Co., Ltd.
(literal translation) 0.69
Abu Dhabi Investment Authority 0.49
China Resources SZITIC Trust Co., Ltd.-Runjin No. 26 Collective
Capital Trust Plan 0.34
Industrial and Commercial Bank of China-Tianyuan
Securities Investment Fund 0.27
Baohong Property (Shenzhen) Co., Ltd.
(literal translation) 0.24
Other shareholders 69.72
Fujian Dongzheng Investment Co.,
Ltd. (literal translation)
====================================
Reg. No.: 350000100029022
Legal representative: Zhou Suwei
Longyan State-own Assets Investment & Operation Co.,
Ltd. (literal translation)
================================================
Reg. No.: 350800100006628
Legal representative: Lin
Chengbiao
l
Legal representative and
chairman:
Mr. Zhou Suhua, born in 1959,
MBA. He is currently responsible for the overall management of SC.
Working Experience(s):
At present Working in SC as chairman and legal
representative
Also working in Shanghai Longking
Environmental Protection Co., Ltd. as legal representative
l
General Manager& Director:
Mr. Huang Wei, born in 1963, with junior college degree, senior engineer.
He is currently responsible for the daily management of SC.
Working Experience(s):
From 2000 to present Working in SC as general
manager and director
l
CEO & Director:
Mr. Wu Jingrong, born in 1961, with bachelor’s degree. He is currently responsible
for the daily management of SC.
Working Experience(s):
From 2001 to present Working in SC as CEO and
director
l
Vice General Managers:
Xiu Haiming
Pan Renhu
Yu Lianfeng
Xiong Yue
Zhang Yuan
Etc.
l
Directors:
Huang Guodian
Yu Lianfeng
Chen Zemin
l
Supervisors:
Zhang Yan
Zeng Lishan
Zhang Ruiqian
SC is mainly
engaged in designing, manufacturing, installing and selling environmental
protection equipment.
SC’s projects main include precipitator products, flue gas desulphurization system, bulk
conveying system, flue gas denitration system.
SC sources its materials 90%
from domestic market and 10% from overseas market. SC sells its products 90% in
domestic market and 10% to overseas market.
The buying terms of SC include Check, L/C, T/T and Credit of
30-60 days. The payment terms of SC include Check, T/T, L/C and Credit of 30-60
days.
Note: SC refused to release its major suppliers and clients.
SC is known to invest in the following companies:
Shanghai Longking Environmental Protection Co.,
Ltd.
Fujian Longking Equipment Installation Co., Ltd.
(literal translation)
Shanghai Longking
Real Estate Development Co., Ltd. (literal translation)
Fujian Longking Desulphurization & Denitrification Engineering Ltd.
Longyan Longking Environmental Protection Machinery
Co., Ltd. (literal translation)
Branches
Beijing Sales Branch
Urumchi Branch
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 declined to
release its banking details.
Consolidated
Balance Sheet
Unit: CNY’000
|
|
as of June 30, 2014 |
as of Dec. 31, 2013 |
|
Cash
& bank |
1,043,919 |
976,935 |
|
Trading
financial assets |
1,431 |
5,161 |
|
Inventory |
4,013,335 |
3,080,257 |
|
Accounts
receivable |
1,427,108 |
1,318,653 |
|
Notes
receivable |
762,138 |
618,803 |
|
Dividends
receivable |
6,555 |
0 |
|
Interest
receivable |
0 |
70 |
|
Other
receivables |
269,962 |
212,479 |
|
Advances to
suppliers |
795,294 |
538,550 |
|
Other
current assets |
14,896 |
57,012 |
|
|
------------------ |
------------------ |
|
Current
assets |
8,334,638 |
6,807,920 |
|
Available-for-sale
financial assets |
207,575 |
235,106 |
|
Long-term
receivables |
156,923 |
144,378 |
|
Investment
property |
48,214 |
48,846 |
|
Fixed
assets net value |
814,929 |
830,466 |
|
Projects
under construction |
75,695 |
36,101 |
|
Long
term investment |
3,616 |
3,749 |
|
Intangible
assets |
340,818 |
348,693 |
|
Development
expenditure |
90 |
90 |
|
Good will |
4,715 |
|
|
Long-term
deferred expenses |
40,868 |
43,297 |
|
Deferred tax
assets |
36,419 |
31,654 |
|
Other
assets |
0 |
0 |
|
|
------------------ |
------------------ |
|
Total
assets |
10,064,500 |
8,535,015 |
|
|
============= |
============= |
|
Short
loans |
352,339 |
336,203 |
|
Notes
payable |
66,206 |
85,328 |
|
Accounts
payable |
1,773,917 |
1,628,664 |
|
Advances from
clients |
3,780,949 |
2,662,822 |
|
Employee
pay payable |
20,926 |
58,560 |
|
Tax
payable |
39,461 |
139,738 |
|
Interest
payable |
7,093 |
16,381 |
|
Dividends
payable |
4,681 |
4,681 |
|
Other
payable |
63,054 |
49,521 |
|
Other
current liabilities |
2,717 |
3,829 |
|
|
------------------ |
------------------ |
|
Current
liabilities |
6,111,343 |
4,985,727 |
|
Long term
liabilities |
968,062 |
688,074 |
|
|
------------------ |
------------------ |
|
Total
liabilities |
7,079,405 |
5,673,801 |
|
Equities |
2,985,095 |
2,861,214 |
|
|
------------------ |
------------------ |
|
Total
liabilities & equities |
10,064,500 |
8,535,015 |
|
|
============= |
============= |
Consolidated
Income Statement
Unit: CNY’000
|
|
Jan.
1 to June 30, 2014 |
as
of Dec. 31, 2013 |
|
Turnover |
2,262,192 |
5,568,212 |
|
Cost of goods
sold |
1,771,811 |
4,387,515 |
|
Taxes
and additional of main operation |
29,962 |
112,297 |
|
Sales expense |
63,277 |
137,329 |
|
Management expense |
218,987 |
492,112 |
|
Finance expense |
28,952 |
59,153 |
|
Asset impairment loss |
4,802 |
7,136 |
|
The
profits on the changes in fair value |
-3,730 |
4,848 |
|
Investment
income |
5,201 |
128,571 |
|
Non-operating
income |
21,997 |
49,222 |
|
Non-operating expense |
1,280 |
3,259 |
|
Profit before
tax |
166,589 |
552,052 |
|
Less: profit tax |
22,229 |
88,732 |
|
Profits |
144,360 |
463,320 |
Important Ratios
=============
|
|
as
of June 30, 2014 |
as
of Dec. 31, 2013 |
|
*Current ratio |
1.36 |
1.37 |
|
*Quick ratio |
0.71 |
0.75 |
|
*Liabilities
to assets |
0.70 |
0.66 |
|
*Net profit
margin (%) |
6.38 |
8.32 |
|
*Return on
total assets (%) |
1.43 |
5.43 |
|
*Inventory
/Turnover ×365 |
/ |
202 days |
|
*Accounts
receivable/Turnover ×365 |
/ |
86 days |
|
*Turnover/Total
assets |
0.22 |
0.65 |
|
* Cost of
goods sold/Turnover |
0.78 |
0.79 |
PROFITABILITY:
FAIRLY GOOD
l
The turnover of SC appears good in its
line.
l
SC’s net profit margin is fairly good.
l
SC’s return on total assets is fairly
good in 2013 and average in the first half year of 2014.
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 normal level.
l
SC’s quick ratio is maintained in a
fair level.
l
The inventory
of SC appears large.
l
The accounts receivable of SC appears
average.
l
SC’s short-term loan is average.
l
SC’s turnover is in a fair level,
comparing with the size of its total assets.
LEVERAGE:
AVERAGE
l
The debt ratio of SC is average.
l
The risk for SC to go bankrupt is
average.
Overall
financial condition of the SC: Fairly Stable.
SC is considered large-sized in its line with fairly stable
financial conditions. The large amount of inventory would be a threat to SC’s
financial conditions.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.60.80 |
|
|
1 |
Rs.100.06 |
|
Euro |
1 |
Rs.78.46 |
INFORMATION DETAILS
|
Analysis Done by
: |
KAR |
|
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|
Report Prepared
by : |
PDT |
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.