MIRA INFORM REPORT

Report No. :	317617
Report Date :	23.04.2015

IDENTIFICATION DETAILS

Name :	THE JAPAN STEEL WORKS LTD
Registered Office :	Gate Ciry Ohsaki-West Tower, 1-11-1 Osaki Shinagawaku, Tokyo, 141-0032
Country :	Japan
Financials (as on) :	31.03.2014
Date of Incorporation :	December 1950
Com. Reg. No.:	0107-01-019531
Legal Form :	Limited Company
Line of Business :	Manufacturing/Selling of Steel and Machinery Products.
No. of Employees :	4,754

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	Yen 6,062.8 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 & address

ENGLISH COMPANY NAME	THE JAPAN STEEL WORKS LTD
Japanese company name	KK NIHONSEIKOSHO (Kabushiki Kaisha)
Registered Office
1. Street Number and District	Gate Ciry Ohsaki-West Tower, 1-11-1 Osaki Shinagawaku
2. City and Perefecture	Tokyo
3. ZIP Code	141-0032
4. Country	JAPAN
TEL	03-5745-2001
FAX	03-5745-2025
URL	www.jsw.co.jp/
Email Address	thru the URL
Activities (Services & Products)	Mfg/Selling of steel and machinery products.
SUMMARY OF REPORT
Annual Sales (MM YEN)	188,719
Capital Amount (MM YEN)	19,694
Net Worth (MM YEN)	139,268
FINANCES	FAIR
TREND	SLOW
EMPLOYEES	4,754
CREDIT LIMIT PROPOSED(MM YEN)	6,062.8
OTHER INFORMATION FOLLOWS:
Year Started	1907
Month and Year Registered	Dec.1950
Regd No.	0107-01-019531
Major Shareholders
1	Japan Trustee Service Bank, Ltd. (11%)
2	The Master Trust Bank of Japan, Ltd. (6%)
3	Other
Number of Shareholders	27,423
Authorized Shares	1,000,000,000
Issued Shares	371,463,036
Executives
PRESIDENT	IKUO SATO
Vice President	Yoshitomo Tanaka
Sr Mgn Director	Nobuaki Shimizu
Sr Mgn Director	Akira Kadota
Mgn Director	Kenji Watanabe
Mgn Director	Yutaka Higashiizumi
Main Banks
1	SMBC (H/O)
2	Sumitomo Mitsui Trust Bank (H/O)
Relations	Satisfactory
Clients
1	Ministry Of Defence
2	Marubeni Itochu Steel Co., Ltd.
3	Sumitomo Corporation
4	Japan Environmental Storage & Safety Corporation
5	Other
Suppliers
1	Allegheny Technologies Japan
2	Coherent Japan, Inc.
3	Mitsui & Co. Steel Ltd.
4	Tanaka Electric Industries Co., Ltd.
5	Other
Branches
1	Osaka
2	Fukuoka
3	Nagoya
4	Hiroshima
5	Other (total 21)
Factories
1	Muroran (plant/total 3)
2	Hiroshima (research laboratory/ total 2)
Overseas
1	Germany
2	U.S.A.
3	Other (total 14)
HIGHLIGHT and COMMENT	The subject company was founded in 1907 as a joint venture between Britain's Armstrong Whitworth Co., Ltd. and Vickers Sons and Maxim, Ltd. with a focus on production of military equipment until the end of World War Ⅱ. After The Second World War , it used its technologies to meet peacetime needs and branched out into new business fields such as materials and equipment for automobiles, eletronics, shipbuilding and petrochemicals. It mainly has been offering steels and steel products over the last three decades. Those are steel and energy products and industrial machinery products, including technical support, testing and advising for the customers. Its head office is located in Tokyo with approximately 20 plants and offices worldwide.
FINANCIAL information	Financials fully disclosed
	The sales volume for March/2014 fiscal term amounted to Yen 188,719 million, a 14% down from Yen 220,653 million in the previous term. 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. For the term that ended March 2015 the recurring profit was projected at Yen 10,000 million and the net profit at Yen 6,000 million, respectively, on a 6% rise in turnover, to Yen 200,000 million. Final results are yet to be released. The financial situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen 6,062.8 million, on 30 days normal terms.
PLEASE ATTACH THE FINANCIALS BELOW.
Note: Forecast (or estimated) figures for the 31/03/2015 fiscal term
Terms Ending	Annual Sales*		R.Profit*		N.Profit*		S.Growth	Net Worth*
31/03/2011	212,929		29,168		16,532		(%)	120,820
31/03/2012	221,368		23,360		12,591		3.96	128,613
31/03/2013	220,653		17,108		8,281		-0.32	134,368
31/03/2014	188,719		9,704		5,527		-14.47	139,268
31/03/2015	200,000		10,000		6,000		5.98	145,268
							*..Unit: Million Yen
FINANCES: (Consolidated in million yen)
		Terms Ending:		31/03/2014		31/03/2013
INCOME STATEMENT
	Annual Sales			188,719		220,653
	Cost of Sales			153,137		176,172
	GROSS PROFIT			35,582		44,481
	Selling & Adm Costs			26,717		27,799
	OPERATING PROFIT			8,865		16,682
	Non-Operating P/L			839		426
	RECURRING PROFIT			9,704		17,108
	NET PROFIT			5,527		8,281
BALANCE SHEET
	Cash			42,329		51,005
	Receivables			48,869		51,970
	Inventory			1,802		1,381
	Securities, Marketable
	Other Current Assets			74,476		69,668
	TOTAL CURRENT ASSETS			167,476		174,024
	Property & Equipment			85,672		94,476
	Intangibles			855		789
	Investments, Other Fixed Assets			39,136		34,681
	TOTAL ASSETS			293,139		303,970
	Payables			42,339		42,216
	Short-Term Bank Loans			12,292		12,703
	Other Current Liabs			44,217		56,377
	TOTAL CURRENT LIABS			98,848		111,296
	Debentures			10,000		10,000
	Long-Term Bank Loans			15,095		17,805
	Reserve for Retirement Allw			10,520		9,543
	Other Debts			19,408		20,958
	TOTAL LIABILITIES			153,871		169,602
	MINORITY INTERESTS
	Common stock			19,694		19,694
	Additional paid-in capital			5,425		5,425
	Retained earnings			110,635		107,861
	Evaluation p/l on investments/securities
	Others			4,244		1,801
	Treasury stock, at cost			(730)		(413)
	TOTAL S/HOLDERS` EQUITY			139,268		134,368
	TOTAL EQUITIES			293,139		303,970
CONSOLIDATED CASH FLOWS
			Terms ending:	31/03/2014		31/03/2013
	Cash Flows from Operating Activities			11,549		23,735
	Cash Flows from Investment Activities			-5,719		-5,832
	Cash Flows from Financing Activities			-15,007		-15,259
	Cash, Bank Deposits at the Term End			42,297		50,972
ANALYTICAL RATIOS Terms ending:				31/03/2014		31/03/2013
			Net Worth (S/Holders' Equity)	139,268		134,368
			Current Ratio (%)	169.43		156.36
			Net Worth Ratio (%)	47.51		44.20
			Recurring Profit Ratio (%)	5.14		7.75
			Net Profit Ratio (%)	2.93		3.75
			Return On Equity (%)	3.97		6.16

JAPAN STEEL WORKS #317617
FINANCES: (CONSOLIDATED IN MILLION YEN)
		Terms Ending:	31/03/2014	31/03/2013	IND/03/2014
INCOME STATEMENT
	Annual Sales		188,719	220,653
	Cost of Sales		153,137	176,172
	GROSS PROFIT		35,582	44,481	0
	Selling & Adm Costs		26,717	27,799
	OPERATING PROFIT		8,865	16,682	0
	Non-Operating P/L		839	426
	RECURRING PROFIT		9,704	17,108	0
	NET PROFIT		5,527	8,281
BALANCE SHEET
	Cash		42,329	51,005
	Receivables		48,869	51,970
	Inventory		1,802	1,381
	Securities, Marketable
	Other Current Assets		74,476	69,668	0
	TOTAL CURRENT ASSETS		167,476	174,024
	Property & Equipment		85,672	94,476
	Intangibles		855	789
	Investments, Other Fixed Assets		39,136	34,681	0
	TOTAL ASSETS		293,139	303,970
	Payables		42,339	42,216
	Short-Term Bank Loans		12,292	12,703
	Other Current Liabs		44,217	56,377	0
	TOTAL CURRENT LIABS		98,848	111,296
	Debentures		10,000	10,000
	Long-Term Bank Loans		15,095	17,805
	Reserve for Retirement Allw		10,520	9,543
	Other Debts		19,408	20,958	0
	TOTAL LIABILITIES		153,871	169,602
	MINORITY INTERESTS				..
	Common stock		19,694	19,694
	Additional paid-in capital		5,425	5,425
	Retained earnings		110,635	107,861
	Evaluation p/l on investments/securities
	Others		4,244	1,801	0
	Treasury stock, at cost		(730)	(413)
	TOTAL S/HOLDERS` EQUITY		139,268	134,368
	TOTAL EQUITIES		293,139	303,970	0
CONSOLIDATED CASH FLOWS
		Terms ending:	31/03/2014	31/03/2013	31/03/2012
	Cash Flows from Operating Activities		11,549	23,735
	Cash Flows from Investment Activities		-5,719	-5,832
	Cash Flows from Financing Activities		-15,007	-15,259
	Cash, Bank Deposits at the Term End		42,297	50,972
ANALYTICAL RATIOS Terms ending:			31/03/2014	31/03/2013	IND/03/2014
		Net Worth (S/Holders' Equity)	139,268	134,368	0
		Current Ratio (%)	169.43	156.36	0
		Net Worth Ratio (%)	47.51	44.20	0
		Recurring Profit Ratio (%)	5.14	7.75	0
		Net Profit Ratio (%)	2.93	3.75	0
		Return On Equity (%)	3.97	6.16	0
Notes: Audited by CPA. IND/xx/yyyy.. Non-consolidated figures for (xx month)/(yyyy year) term.
		Current Sales	188,719
		Credit Limit	6,062.8

JAPAN STEEL WORKS #317617
BUSINESS	TERMS ENDING	ANNUAL SALES*	R.PROFIT*	N.PROFIT*	S.GROWTH	NET WORTH*
Results:	31/03/2011	212,929	29,168	16,532	(%)	120,820
(Consolidated)	31/03/2012	221,368	23,360	12,591	3.96	128,613
	31/03/2013	220,653	17,108	8,281	-0.32	134,368
	31/03/2014	188,719	9,704	5,527	-14.47	139,268
	31/03/2015	200,000	10,000	6,000	5.98	145,268
	Forecast (or estimated) figures for 2015 term.				*..Unit: Million Yen

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.82
UK Pound	1	Rs.93.85
Euro	1	Rs.67.59

INFORMATION DETAILS

Analysis Done by :	DIV
Report Prepared by :	TPT

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%)

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