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Report No. : |
334388 |
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Report Date : |
01.08.2015 |
IDENTIFICATION DETAILS
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Name : |
ITOCHU CORPORATION |
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Registered Office : |
2-5-1 Kitaaoyama Minatoku |
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Country : |
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Financials (as on) : |
31.03.2014 (Consolidated) |
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Date of Incorporation : |
December 1949 |
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Com. Reg. No.: |
1200-01-077358 (Osaka-Chuoku) |
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Legal Form : |
Limited Company |
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Line of Business : |
Subject is a general trading house, currently top textile trader among
domestic trading companies, with comprehensive strength in all areas of the textile
industry from upstream to down-stream operations, while actively trying to
expand into textile retailing |
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No of Employees : |
104,543 |
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 – March 31, 2015
|
Country Name |
Previous Rating (31.12.2014) |
Current Rating (31.03.2015) |
|
Japan |
a1 |
a1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
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 |
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 an 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. Scarce in many natural resources, Japan has long been dependent on imported raw materials. Since the complete shutdown of Japan’s nuclear reactors after the earthquake and tsunami disaster in 2011, Japan's industrial sector has become even more dependent than it was previously on imported fossil 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 impressive - 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 aftereffects 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. 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 of that year disrupted manufacturing. The economy has largely recovered in the four years since the disaster, although reconstruction in the affected Tohoku region has lagged, in part due to a shortage of labor in the construction sector. Japan enjoyed a sharp uptick in growth in 2013 on the basis of Prime Minister Shinzo Abe’s “Three Arrows” economic revitalization agenda - dubbed “Abenomics” - of monetary easing, “flexible” fiscal policy, and structural reform. Abe’s government has replaced the preceding administration’s plan to phase out nuclear power with a new policy of seeking to restart nuclear power plants that meet strict new safety standards, and emphasizing nuclear energy’s importance as a base-load electricity source. Japan joined the Trans-Pacific Partnership (TPP) 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. While seeking to stimulate and reform the economy, the government must also devise a strategy for reining in Japan's huge government debt, which amounts to more than 230% of GDP. To help raise government revenue, Japan adopted legislation in 2012 to gradually raise the consumption tax rate to 10% by 2015, beginning with a hike from 5% to 8% implemented in April 2014. That increase had a contractionary effect on GDP, however, so PM Abe in late 2014 decided to postpone the final phase of the increase until April 2017 to give the economy more time to recover. Led by the Bank of Japan’s aggressive monetary easing, Japan is making progress in ending deflation, but demographics - low birthrate and an aging, shrinking population - pose major long-term challenges for the economy.
|
Source : CIA |
ITOCHU CORPORATION
REGD NAME: Itochu Shoji KK
2-5-1 Kitaaoyama
Minatoku Tokyo 107-8807 JAPAN
Tel:
03-3497-2121 Fax: 03-3497-4141
*.. Registered at: 3-1-3 Umeda Kitaku Osaka, as given
E-Mail address: webmaster@itochu.co.jp
Subject is a general trading house, currently top textile trader
among domestic trading companies, with comprehensive strength in all areas of
the textile industry from upstream to down-stream operations, while actively
trying to expand into textile retailing
Osaka,
Nagoya, Fukuoka, Hiroshima, Sapporo, other (Tot 90)
North/South
America, Europe, China, S/E Asia, other (Tot 115 over 80 countries)
MASAHIRO
OKAFUJI, PRES & CEO
Yen
Amount: In million Yen, unless
otherwise stated
FINANCES FAIR A/SALES Yen 14,566,820 M
PAYMENTS No
Complaints CAPITAL Yen
202,241 M
TREND UP WORTH Yen 2,522,823 M
STARTED 1949 EMPLOYES 104,543
NATION’S
LEADING GENERAL TRADING HOUSE.
FINANCIAL SITUATION CONSIDERED
FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.
|
Business |
Terms Ending |
Annual Sales* |
R.Profit* |
N.Profit* |
S.Growth |
Net Worth* |
|
Results: |
31/03/2011 |
11,392,589 |
182,097 |
160,975 |
(%) |
1,398,954 |
|
(Consolidated) |
31/03/2012 |
11,978,286 |
341,174 |
300,505 |
5.14 |
1,696,141 |
|
|
31/03/2013 |
12,551,557 |
311,112 |
280,297 |
4.79 |
2,112,619 |
|
|
31/03/2014 |
14,566,820 |
373,808 |
310,267 |
16.06 |
2,522,823 |
|
|
31/03/2015 |
14,700,000 |
438,000 |
300,000 |
0.91 |
.. |
Unit: In Million Yen
Forecast (or estimated) figures for 31/03/2015 fiscal term
This is major general trading house, currently top textile trader among
domestic trading companies, with comprehensive strength in all areas of the
textile industry from upstream to down-stream operations, while actively trying
to expand into textile retailing. Also
strong in food industry, machinery plants, chemicals, energy and
condominiums. Further aggressive in
satellite communications to lead other trading houses in telecom & China
businesses. Has stake in Perfect TV
satellite broadcaster. Implemented
independently managed “division company system” in Apr 1997. (See OPERATION). Acquired 3% stake in UNY, general
supermarket operator based in Tokai area for collaboration in merchandise
development and operation in China.
Constructing export terminals on West Coast jointly with major US grain
firm as strategic base for export to China & other Asian countries. Capital spending is at Yen 350 billion-plus
in the March 2012 and March 2013 terms for metals & energy resources. The company is eager to acquire additional
new metals resources in light of opportunities presented by the deteriorating
market, and will focus on iron ore and coal.
It will adopt IFRS from the March 2015 term. The company plans to increase payout ratio
from the present figure of around 23%.
The sales volume for Mar/2014 fiscal term amounted to Yen 14,566,820
million, a 16.1% up from Yen 12,551,557 million in the previous term. Food business benefitted from the buyout of
US Dole. Energy business improved
without the impairment of shale gas interest last term. The weaker Yen pushed up earnings by overseas
subsidiaries. The recurring profit was
posted at Yen 373,808 million and the net profit at Yen 310,267 million,
respectively, compared with Yen 3,112,112 million recurring profit and Yen
280,297 million net profit, respectively, a year ago.
For the current term ending Mar 2015 the recurring profit is projected
at Yen 438,000 million and the net profit at Yen 300,000 million, respectively,
on a 1% up in turnover, to Yen 14,700,000 million. The resource business will continue to
struggle, but food and machinery businesses will drive sales growth.
The financial situation is considered FAIR and good for ORDINARY
business engagements.
Date Registered: Dec
1949
Regd No.: 1200-01-077358
(Osaka-Chuoku)
Legal Status: Limited Company (Kabushiki Kaisha)
Authorized: 3,000 million shares
Issued:
1,584,889,504 shares
Sum: Yen 202,241 million
Major shareholders
(%): Japan Trustee Services Bank T (4.9), Master Trust Bank of Japan T
(4.5), Chase London Omnibus Acct (2.5), Mizuho Bank (2.4), Mitsui Sumitomo Ins
(2.3), Nippon Life Ins (2.1), Bank of New York Treaty Jasdec (1.7), Nippon Koa
Ins (1..7), Asahi Life Ins (1.7), Barclays Securities Japan (1.5); foreign
owners (39.4)
No. of
shareholders: 120,389
Listed on the
S/Exchange (s) of: Tokyo
Managements: Eizo Kobayashi, ch;
Masahiro Okafuji, pres; Yoichi Kobayashi, v pres; Tadayuki Seki, v pres; Yoshihisa Aoki, s/mgn
dir; Koji Takayanagi, s/mgn dir; Ichiro Nakamura, s/mgn dir; Tomofumi Yoshida,
s/mgn dir; Hitoshi Okamoto, s/mgn dir; Takao Shiomi, s/mgn dir; Yuji Fukuda, mgn
dir; Shuichi Koseki, mgn dir; Junichi Sasaki, mgn dir
Nothing detrimental is known as to the commercial morality of
executives.
Related companies: Itochu Techno
Solutions, Itochu Shokuhin, Itochu Enex, other
Activities: Activities: A general
trading house; Sales breakdown by divisions:
Textile Company
(5%): Raw cotton, Cotton yarns, Wool, yarns, Rayon staple, Spun rayon yarns,
Rayon yarns, Synthetic staple, Synthetic filament, Cotton fabrics, Wool
fabrics, Silk fabrics, Rayon fabrics, Spun rayon fabrics, Synthetic filament
fabrics, Knit fabrics, Knit outer garments, Knit under garments, Woven outer
garments, Woven under garments, Other garments, Secondary textile products,
Imported sundries, Bedding fabrics, Interior fabrics, Industrial fibres,
Inorganic fibres and related products
Machinery Company (9%): Civil engineering, Construction,
Mining and related materials handling machinery, Agricultural machinery,
Metalworking and processing machinery and plant, Forging machinery, Textile machinery,
Semiconductor manufacturing equipment, Automobile parts manufacturing plant,
Plant related to the iron and steel industry, Cement plant, Food machinery,
Grain silos, Hospital equipment, Oil, gas, and chemical plants, Passenger
vehicles, Commercial vehicles, Automobile parts and equipment, Special-purpose
vehicles, Rolling stock, Ships, Power generating equipment
Aerospace,
Electronics & Multimedia Company (2%):
Satellite communications, International telecommunications, Terminals and
peripheral equipment for broadcasting and communications systems, Entertainment
and content business, Systems and related machinery for mobile telephones,
Systems and related equipment for computer and information processing,
Semiconductor equipment, Aircraft, In-flight equipment, Space-related
equipment, Security equipment etc.
Energy, Metals
& Minerals Company (33%):
Iron ore, Direct reduced iron, Coking coal, Coke, Thermal coal, Ferro alloy and
its materials, Ferrous scrap, Pig iron, Metal powder, Electrodes, Activated
carbon, Steel plates, Hot & cold rolled sheets and coils, Galvanized steel,
Steel for machinery, Stainless steel, High tensile steel, Construction
materials, Welded steel pipes, Seamless steel pipes, Steel wires, Marine steel
structures, Bridges, Prefabricated steel for buildings, Rails, Non-ferrous
metals, Precious metals, Rare metals, Aluminium, Crude oil, Natural gas liquid
(NGL), Gasoline, Naphtha, Kerosene, Jet fuel, Gas oil, Fuel oil, Bunker oil,
Lubricant, Asphalt, Liquefied petroleum gas (LPG), Liquefied natural gas (LNG),
Nuclear fuel (uranium concentrates, uranium hexafluoride), Nuclear power
related equipment
Chemicals, Forest
Products & General Merchandise Company (18%): Logs, Lumber, Wooden
building materials, Wood chips, Wood pulp, Recycled paper, Cotton linter,
Paper, Paperboard, Paper products, Natural rubber, Tyres, Footwear, Furniture,
Glass, Cement crysotile, Landscape materials, Refractory materials and
products, Natural gypsum Chemical feedstock, Olefin, Aromatics, Raw materials
for synthetic resins, Tar chemicals, Raw materials for synthetic fibres,
Organic chemicals, Methanol, Ethanol, Solvents, Specialty chemicals, Inorganic
chemicals, Chemical fertilizers, Vinyl chloride, Polyolefin, Synthetic rubbers,
Carbon black, Thermoplastic and thermosetting resins, Resin additives, Glass
fibres
Food Company (27%): Wheat, Barley, Wheat flour,
Rice, Starches, Soybeans, Sunflower oil, Olive oil, Palm oil, Coconut oil,
Corn, Soybean meal, Rapeseed meal, Fish meal, Alfalfa pellets, Raw sugar,
Sweeteners, High-fructose corn syrup, Dairy products, Nuts, Coffee, Cocoa,
Fruit juice, Liquor, Soft drinks, Beef, Pork, Chicken, Fruits and vegetables,
Processed foods, Frozen foods, Canned foods, Pet foods, Consulting services for
food business.
Finance, Realty,
Insurance & Logistics Services Company (6%): Finance: Foreign exchange and securities trading,
securities and fund investment, asset management (including structuring and
sales of financial products), lending, online securities broking, other
financial services; Realty: Planning,
developing, constructing, contracting, managing, operating, selling related
facilities and materials for residential housing, office buildings, resort
facilities, golf courses, industrial parks, hotels; Insurance: Insurance and reinsurance agency, broking of
insurance and reinsurance, consulting of insurance and reinsurance; Logistics
services: Warehousing, trucking,
operation of logistics centres, chartering, international intermodal transport,
air cargo, travel services, distribution processing, freight forwarding,
customs clearance
Overseas trading
ratio: (42%)
Clients: [Wholesalers,
mfrs] Itochu Shokuhin, Nippon Access, Idemitsu Kosan Kaisha, Japan Gas Energy, JX
Nippon Oil & Energy Corp, other.
No. of accounts: 3,000
Domestic areas of activities: Nationwide
Suppliers: [Mfrs,
wholesalers, carmakers] Mazda Motor, Nippon Steel, Isuzu Motors, Nissin Food
Products, JGC Corp, Dole, Nissin Foods, Dole Japan Inc, JX Nippon Oil &
Energy Corp, Japan Petroleum Exploration Co, Sakhalin Oil & Gas, other.
Payment record: No
Complaints
Location: Business area in
Tokyo. Office premises at the caption
address are owned and maintained satisfactorily.
Bank
References:
Mizuho Bank (H/O)
SMBC (H/O)
Relations:
Satisfactory
(In Million Yen)
|
FINANCES: (Consolidated in million yen) |
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Terms Ending: |
31/03/2014 |
31/03/2013 |
|
INCOME STATEMENT |
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Annual Sales |
|
14,566,820 |
12,551,557 |
|
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Cost of Sales |
13,538,547 |
11,635,678 |
|
|
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GROSS PROFIT |
1,028,273 |
915,879 |
|
|
|
Selling & Adm Costs |
749,179 |
671,660 |
|
|
|
OPERATING PROFIT |
279,094 |
244,219 |
|
|
|
Non-Operating P/L |
94,714 |
66,893 |
|
|
|
RECURRING PROFIT |
373,808 |
311,112 |
|
|
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NET PROFIT |
310,267 |
280,297 |
|
|
BALANCE SHEET |
|
|
|
|
|
|
Cash |
|
653,332 |
569,716 |
|
|
Receivables |
|
1,639,774 |
1,543,851 |
|
|
Inventory |
|
749,927 |
657,853 |
|
|
Securities, Marketable |
4,536 |
3,655 |
|
|
|
Other Current Assets |
787,300 |
781,108 |
|
|
|
TOTAL CURRENT ASSETS |
3,834,869 |
3,556,183 |
|
|
|
Property & Equipment |
856,912 |
804,255 |
|
|
|
Intangibles |
|
|
|
|
|
Investments, Other Fixed
Assets |
3,156,659 |
2,757,008 |
|
|
|
TOTAL ASSETS |
7,848,440 |
7,117,446 |
|
|
|
Payables |
|
1,333,025 |
1,288,770 |
|
|
Short-Term Bank Loans |
402,262 |
135,880 |
|
|
|
|
|
|
|
|
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Other Current Liabs |
847,687 |
1,051,291 |
|
|
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TOTAL CURRENT LIABS |
2,582,974 |
2,475,941 |
|
|
|
Debentures |
|
|
|
|
|
Long-Term Bank Loans |
2,628,937 |
2,447,868 |
|
|
|
Reserve for Retirement
Allw |
41,613 |
36,804 |
|
|
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Other Debts |
|
72,093 |
44,214 |
|
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TOTAL LIABILITIES |
5,325,617 |
5,004,827 |
|
|
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MINORITY INTERESTS |
|
|
|
|
|
Common stock |
202,241 |
202,241 |
|
|
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Additional paid-in capital |
113,820 |
113,408 |
|
|
|
Retained earnings |
1,746,843 |
1,501,428 |
|
|
|
Evaluation p/l on investments/securities |
99,737 |
99,018 |
|
|
|
Others |
|
362,982 |
199,227 |
|
|
Treasury stock, at cost |
(2,800) |
(2,703) |
|
|
|
TOTAL S/HOLDERS`
EQUITY |
2,522,823 |
2,112,619 |
|
|
|
TOTAL EQUITIES |
7,848,440 |
7,117,446 |
|
|
CONSOLIDATED CASH FLOWS |
|
|
||
|
|
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Terms ending: |
31/03/2014 |
31/03/2013 |
|
|
Cash Flows from Operating Activities |
|
418,396 |
245,661 |
|
|
Cash Flows from Investment Activities |
-266,692 |
-199,990 |
|
|
|
Cash Flows from Financing Activities |
-71,707 |
-11,323 |
|
|
|
Cash, Bank Deposits at the Term End |
|
653,332 |
569,716 |
|
ANALYTICAL RATIOS Terms ending: |
31/03/2014 |
31/03/2013 |
||
|
|
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Net Worth (S/Holders' Equity) |
2,522,823 |
2,112,619 |
|
|
|
Current Ratio (%) |
148.47 |
143.63 |
|
|
|
Net Worth Ratio (%) |
32.14 |
29.68 |
|
|
|
Recurring Profit Ratio (%) |
2.57 |
2.48 |
|
|
|
Net Profit Ratio (%) |
2.13 |
2.23 |
|
|
|
Return On Equity (%) |
12.30 |
13.27 |
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.64.01 |
|
|
1 |
Rs.99.44 |
|
Euro |
1 |
Rs.70.16 |
INFORMATION DETAILS
|
Analysis Done by
: |
RAS |
|
|
|
|
Report Prepared
by : |
SDA |
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.