MIRA INFORM REPORT

 

 

Report No. :

315794

Report Date :

22.04.2015

 

IDENTIFICATION DETAILS

 

Name :

HI-LEX CORPORATION

 

 

Registered Office :

1-12-28 Sakaecho Takarazuka City Hyogo-Pref 665-0845

 

 

Country :

Japan

 

 

Financials (as on) :

31.10.2014

 

 

Date of Incorporation :

Nov., 1946

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Manufacturer of Control Cable for Vehicles.

 

 

No. of Employees :

10,737

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

 

Maximum Credit Limits :

Yen 9,614.7 Million

 

 

Status :

Good 

 

 

Payment Behaviour :

Regular

 

 

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

 

Country Name

Previous Rating

(30.09.2014)

Current Rating

(31.12.2014)

Japan

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

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. Since the complete shutdown of Japan’s nuclear reactors after the earthquake and tsunami disaster in 2011, Japan's industrial sector has become 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 four 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. A sales tax increase caused the economy to contract during the 2nd and 3rd quarters of 2014. The economy has largely recovered in the three years since the disaster, but reconstruction in the Tohoku region has been uneven due to labor shortages. 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 2014 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 government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which amounts to more than 240% 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 2015, although the government in 2014 decided to postpone the final phase of the increase until 2017 to give the economy time to recover from the 2014 increase. 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.

 

Source : CIA

 

 

Company Name and address

 

HI-LEX CORPORATION

 

REGD NAME:               KK Hi-Lex Corporation

 

MAIN OFFICE:              1-12-28 Sakaecho Takarazuka City Hyogo-Pref 665-0845 JAPAN

                                                Tel: 0797-85-2500     Fax: 0797-86-6405

 

                                    *.. The given postal code number if of its Hiroshima Mfg Factory     -

 

URL:                 http://www.hi-lex.co.jp

E-Mail address:            (thru the URL)

 

 

ACTIVITIES

 

Mfg of control cable for vehicles

 

 

BRANCHES

 

Tokyo, Nagoya, Hiroshima, Hamamatsu, Utsunomiya

 

 

OVERSEAS

 

USA, Korea, Indonesia, Malaysia, Thailand, Great Britain, Mexico, China, Vietnam, India, Brazil

 

 

FACTORIES  

 

Takarazuka, Sanda, Sanda-Nishi, Kaibara, Mikkabi

 

 

CHIEF EXEC 

 

MAKOTO TERAURA, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 A/SALES                      Yen 201,447 M

PAYMENTSREGULAR   CAPITAL                       Yen 5,657 M

TREND UP                    WORTH                        Yen 134,567 M

STARTED         1946                 EMPLOYES                 10,737

 

 

COMMENT

 

MFR OF CONTROL CABLES FOR VEHICLES 

 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                       

MAX CREDIT LIMIT: YEN 9,614.7 MILLION, 30 DAYS NORMAL TERMS

 

Unit: In Million Yen

Forecast figures for the 31/10/2015 fiscal term.

 

 

HIGHLIGHTS

 

This is the largest mfr of control cable for motor vehicles (two- & four-wheeled). Aggressively involved in overseas operations. Window regulators making strong growth. Start-to-finish production. Independent of any corporate affiliation.

 

 

FINANCIAL INFORMATION

 

The sales volume for Oct/2014 fiscal term amounted to Yen 201,447 million, a 22.1% up from Yen 164,956 million in the previous term.  The recurring profit was posted at Yen 20,379 million and the net profit at Yen 13,051 million, respectively, compared with Yen 17,089 million recurring profit and Yen 10,623 million net profit, respectively, a year ago.

 

(Nov/2014-Jan/2015results): Sales Yen 58,459 million (up 20.3%), operating profit Yen 4,833 million (down 6.5%), recurring profit Yen 6,122 million (up 5.4%), net profit Yen 4,148 million (down 2.3%).  (% as compared with the corresponding period a year ago).

 

For the current term ending Oct 2015 the recurring profit is projected at Yen 20,960 million and the net profit at Yen 13,850 million, respectively, on a 7.1% rise in turnover, to Yen 215,800 million.

 

The financial situation is considered FAIR and good for ORDINARY business engagements.  Max credit limit is estimated at Yen 9,614.7 million, on 30 days normal terms.

 

 

REGISTRATION

           

Date Registered:　                   Nov 1946

Legal Status:                Limited Company (Kabushiki Kaisha)

Authorized:                              80 million shares

Issued:                         38,216,759 shares

Sum:                            Yen 5,657 million

 

Major shareholders (%): Teraura Kosan (19.8), JP Morgan Chase Bank (5.1), Northern Trust (AVFC) (4.8), Teraura Shogakukai (4.0), State Street Bank & Trust (1.5), other; foreign owners (30.5)

 

No. of shareholders: 2,596

 

Listed on the S/Exchange (s) of: Tokyo (Second section)

 

Managements: Makoto Teraura, pres; Mitsuhiro Nakano, s/mgn dir; Katsuaki Shima, mgn dir; Shoichi Hirai, mgn dir; Taro Teraura, mgn dir; Yasuko Masaki, dir; Tohru Kato, dir

 

Nothing detrimental is known as to the commercial morality of executives.

 

Related companies: Hi-Lex Kanto, Hi-Lex Controls, other.

 

 

OPERATION

           

Activities: Manufactures control cables for vehicles (43%), window regulators (28%), door modules (24%), others (6%)

Overseas Sales Ratio (76%)

           

Clients: [Mfrs, wholesalers] Fuji Heavy Ind, Mazda Motor, Honda Motor, Hi-Lex Mexicana, Daihatsu Ind, other

No. of accounts: 500

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Mitsui Bussan Plastic, Mitsuba, Mabuchi Motor, Tajima TSK Inc, Mitsui & Co, other

 

Payment record: Regular

 

Location: Business area in Takarazuka City, Hyogo-Pref.  Office premises at the caption address are owned and maintained satisfactorily.

 

Bank References:

            SMBC (Kobe)

            MUFG (Amagasaki-Ekimae)

            Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

　

　

　

Terms Ending:

31/10/2014

31/10/2013

INCOME STATEMENT

　

　

  Annual Sales

　

201,447

164,956

　

  Cost of Sales

166,354

136,999

　

      GROSS PROFIT

35,092

27,957

　

  Selling & Adm Costs

16,523

14,079

　

      OPERATING PROFIT

18,569

13,877

　

  Non-Operating P/L

1,810

3,212

　

      RECURRING PROFIT

20,379

17,089

　

      NET PROFIT

13,051

10,623

BALANCE SHEET

　

　

  Cash

　

40,286

33,924

　

  Receivables

38,192

32,443

　

  Inventory

19,743

15,035

　

  Securities, Marketable

1,335

1,768

　

  Other Current Assets

5,781

3,712

　

      TOTAL CURRENT ASSETS

105,337

86,882

　

  Property & Equipment

43,134

32,780

　

  Intangibles

7,267

2,807

　

  Investments, Other Fixed Assets

38,285

34,551

　

      TOTAL ASSETS

194,023

157,020

　

  Payables

26,295

21,529

　

  Short-Term Bank Loans

7,017

2,185

　

　

　

　

　

  Other Current Liabs

14,593

10,439

　

      TOTAL CURRENT LIABS

47,905

34,153

　

  Debentures

　

　

　

  Long-Term Bank Loans

1,207

612

　

  Reserve for Retirement Allw

1,697

774

　

  Other Debts

　

8,647

7,556

　

      TOTAL LIABILITIES

59,456

43,095

　

      MINORITY INTERESTS

　

　

Common stock

5,657

5,657

　

Additional paid-in capital

7,105

7,105

　

Retained earnings

100,838

89,632

　

Evaluation p/l on investments/securities

12,195

11,040

　

Others

9,084

798

　

Treasury stock, at cost

(312)

(308)

　

      TOTAL S/HOLDERS` EQUITY

134,567

113,924

　

      TOTAL EQUITIES

194,023

157,020

CONSOLIDATED CASH FLOWS

　

　

Terms ending:

31/10/2014

31/10/2013

　

Cash Flows from Operating Activities

　

13,482

10,660

　

Cash Flows from Investment Activities

-9,037

-9,715

　

Cash Flows from Financing Activities

327

-1,182

　

Cash, Bank Deposits at the Term End

　

38,980

32,209

ANALYTICAL RATIOS            Terms ending:

31/10/2014

31/10/2013

　

Net Worth (S/Holders' Equity)

134,567

113,924

　

Current Ratio (%)

219.89

254.39

　

Net Worth Ratio (%)

69.36

72.55

　

Recurring Profit Ratio (%)

10.12

10.36

　

Net Profit Ratio (%)

6.48

6.44

　

　

Return On Equity (%)

9.70

9.32


 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.62.92

UK Pound

1

Rs.93.57

Euro

1

Rs.67.34

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

NIT

 

               

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%)

 

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.