MIRA INFORM REPORT
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Report No. : |
315742 |
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Report Date : |
04.04.2015 |
IDENTIFICATION DETAILS
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Name : |
LAIWU FORGING CO., LTD. |
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Registered Office : |
Zhaili Town, Laicheng District, Laiwu Shandong Province 271121 Pr |
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Country : |
China |
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Financials (as on) : |
31.12.2014 |
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Date of Incorporation : |
16.05.2006 |
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Com. Reg. No.: |
371200228039357 |
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Legal Form : |
One-Person Limited Liability Company |
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Line of Business : |
Forging processing; wholesale and retail of auto parts, hardware, and
chemical products. |
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No. of Employees : |
286 |
RATING & COMMENTS
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MIRA’s Rating : |
B |
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RATING |
STATUS |
PROPOSED CREDIT LINE |
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26-40 |
B |
Capability to overcome financial difficulties seems comparatively
below average. |
Small |
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Status : |
Moderate |
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Payment Behaviour : |
Slow but correct |
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Litigation : |
Clear |
NOTES:
Any query related to this report can be made
on e-mail: infodept@mirainform.com
while quoting report number, name and date.
ECGC Country Risk Classification List – December 31, 2014
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Country Name |
Previous Rating (30.09.2014) |
Current Rating (31.12.2014) |
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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 |
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.
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Source
: CIA |
Company
name & address
LAIWU FORGING CO., LTD.
ZHAILI TOWN, LAICHENG DISTRICT, LAIWU SHANDONG PROVINCE 271121 PR CHINA
TEL: 86 (0) 634-6512388/6511323/6506701
FAX: 86 (0) 634-6512388/6512399
EXECUTIVE
SUMMARY
DATE OF REGISTRATION : MAY
16, 2006
REGISTRATION NO. :
371200228039357
LEGAL FORM :
ONE-PERSON LIMITED LIABILITY COMPANY
CHIEF EXECUTIVE :
LV GUITING (LEGAL REPRESENTATIVE)
REGISTERED CAPITAL : CNY 16,000,000
STAFF :
286
BUSINESS CATEGORY : PROCESSING
REVENUE :
CNY 118,610,000 (AS OF DEC. 31, 2014)
EQUITIES :
CNY 20,260,000 (AS OF DEC. 31, 2014)
WEBSITE :
WWW.LAIWUFORGING.COM
E-MAIL :
LUJUN@LAIWUFORGING.COM
PAYMENT :
AVERAGE
MARKET CONDITION :
AVERAGE
FINANCIAL CONDITION :
FAIR
OPERATIONAL TREND : FAIRLY STEADY
GENERAL REPUTATION :
AVERAGE
EXCHANGE RATE :
CNY 6.21 = USD
Adopted
abbreviations (as follows)
SC - Subject Company (the company inquired by you)
N/A – Not available
CNY – China Yuan Ren Min Bi
OPERATIONAL
TREND & GENERAL REPUTATION
This section aims at indicating the relative positions of SC in respect
of its operational trend & general reputation
Operational Trend:- General
Reputation:-
Upward Excellent
Steady Good
Fairly Steady Fairly
Good
Ordinary Average
Fair Fair
Stagnant Detrimental
Downward Not
known
Not known Not
yet be determined
Not yet be determined
LEGAL STATUS & HISTORY
SC was established as one-person limited liabilities company of PRC with
State Administration of Industry & Commerce (SAIC) under registration No.: 371200228039357
on May 16, 2006.
SC’s Organization Code Certificate No.: 78925063-9
SC’s Tax No.: 371202789250639
SC’s registered capital: CNY 16,000,000
SC’s paid-in capital: CNY 16,000,000
Registration Change Record:-
No significant changes of SC have been noted in SAIC since its
incorporation.
Current Co search indicates SC’s shareholders & chief executives are
as follows:-
|
Name of Shareholder (s) |
% of Shareholding |
|
Lv Guiting |
100 |
SC’s Chief Executives:-
|
Position |
Name |
|
Legal Representative, Chairman, and General Manager |
Lv Guiting |
|
Supervisor |
Zhao Honghe |
RECENT DEVELOPMENT
No recent development was found during our checks at present.
SHAREHOLDER CHART & BACKGROUND
Name %
of Shareholding
Lv Guiting 100
MANAGEMENT
Lv Guiting, Legal Representative, Chairman and General Manager
--------------------------------------------------------------------------------------------------
Gender: M
Qualification: University
Working experience (s):
From 2006 to present, working in SC as legal representative, chairman
and general manager
Zhao Honghe, Supervisor
---------------------------------------------
Gender: M
BUSINESS OPERATION
SC’s registered business scope includes forging
processing; wholesale and retail of auto parts, hardware, and chemical
products.
SC is mainly engaged in forging processing.
SC’s products mainly include: pipe mould, petrochemical forgings, and forgings.
SC sources its materials 100% from domestic market, mainly Shandong. SC sells 80% of its products in domestic market, and 20% to overseas market.
The buying terms of SC include Check, T/T and Credit of 30-60 days. The
payment terms of SC include T/T, L/C and Credit of 30-60 days.
*Major Customer:
=============
Tri Wave, LLC.
Staff & Office:
--------------------------
SC is known to have approx. 286 staff at present.
SC owns an area as its operating office & factory of approx. 60,000
sq. meters at the heading address.
RELATED COMPANY
SC is not known to have any subsidiary at present.
PAYMENT
Overall payment
appraisal: ( ) Excellent ( ) Good (X) Average ( )
Fair ( ) Poor ( ) Not yet be 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.
BANKING
Basic Bank:
Industrial
and Commercial Bank of China Laiwu Laicheng Sub-branch
AC#: 1617010709024901862
FINANCIALS
Balance Sheet
|
Unit: CNY’000 |
As of Dec. 31,
2014 |
|
Cash |
5,110 |
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Notes receivable |
0 |
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Accounts receivable |
1,200 |
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Advances to suppliers |
0 |
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Other receivable |
30,620 |
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Inventory |
74,280 |
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Non-current assets within one year |
0 |
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Other current assets |
820 |
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------------------ |
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Current assets |
112,030 |
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Fixed assets |
80,570 |
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Long-term prepaid expenses |
0 |
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Deferred income tax assets |
0 |
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Other non-current assets |
0 |
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------------------ |
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Total assets |
192,600 |
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============= |
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Short-term loans |
100,000 |
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Notes payable |
0 |
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Accounts payable |
25,830 |
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Advances from clients |
0 |
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Other payable |
37,390 |
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Other current liabilities |
700 |
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------------------ |
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Current liabilities |
163,920 |
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Non-current liabilities |
8,420 |
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------------------ |
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Total liabilities |
172,340 |
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Equities |
20,260 |
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------------------ |
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Total liabilities & equities |
192,600 |
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============= |
Income Statement
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Unit: CNY’000 |
As of Dec. 31,
2014 |
|
Revenue |
118,610 |
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Cost of sales |
106,550 |
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Sales expense |
690 |
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Management expense |
6,010 |
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Finance expense |
8,650 |
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Profit before tax |
-3,120 |
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Less: profit tax |
0 |
|
Profits |
-3,120 |
Important Ratios
=============
|
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As of Dec. 31,
2014 |
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*Current ratio |
0.68 |
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*Quick ratio |
0.23 |
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*Liabilities to assets |
0.89 |
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*Net profit margin (%) |
-2.63 |
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*Return on total assets (%) |
-1.62 |
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*Inventory / Revenue ×365 |
229 days |
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*Accounts receivable/ Revenue ×365 |
4 days |
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*Revenue/Total assets |
0.62 |
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*Cost of sales / Revenue |
0.90 |
FINANCIAL COMMENTS
PROFITABILITY:
FAIR
The revenue of SC appears fairly good in its line.
SC’s net profit margin is fair.
SC’s return on total assets is fair.
SC’s cost of sales is average, comparing with its revenue.
LIQUIDITY: FAIR
The current ratio of SC is maintained in a fair level.
SC’s quick ratio is maintained in a poor level.
The inventory of SC appears large.
The accounts receivable of SC is maintained in an average level.
The short-term loans of SC appear large.
SC’s revenue is in a fair level, comparing with the size of its total
assets.
LEVERAGE: FAIR
The debt ratio of SC is fairly high.
The risk for SC to go bankrupt is above average.
Overall financial condition of the SC: Fair.
CONCLUSIONS
SC is considered small-sized in its line with fair financial conditions.
The large amount of inventory and short-term loans may be a threat to SC’s
financial condition.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.62.59 |
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|
1 |
Rs.92.46 |
|
Euro |
1 |
Rs.67.51 |
INFORMATION DETAILS
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Analysis Done by
: |
SUC |
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Report Prepared
by : |
TPT |
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.