MIRA INFORM REPORT

 

 

Report No. :

338434

Report Date :

27.08.2015

 

IDENTIFICATION DETAILS

 

Name :

NIPPON SEIRO CO LTD

 

 

Registered Office :

Kyobashi Soseikan 10F, 2-5-18 Kyobashi Chuoku Tokyo 104-0031

 

 

Country :

Japan

 

 

Financials (as on) :

31.12.2014

 

 

Date of Incorporation :

February 1951

 

 

Com. Reg. No.:

0100-01-034983

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Subject is manufactures petroleum waxes, wax products (paraffin wax, microcrystalline wax, anti-ozone wax for rubber & tire), other (49%), fuel oil (residue of crude oil) (50%), others (1%)

 

 

No. of Employees :

233

 

 

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

 

Status :

Satisfactory

 

 

Payment Behaviour :

Slow but correct

 

 

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

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 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 first-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

 

 

 

Company name

 

NIPPON SEIRO CO LTD

 

 

REGD NAME

 

Nippon Seiro KK

 

 

MAIN OFFICE

 

Kyobashi Soseikan 10F, 2-5-18 Kyobashi Chuoku Tokyo 104-0031 JAPAN

Tel: 03-3538-3061

 

URL:                 http://www.seiro.co.jp

E-Mail address: (thru the URL)

 

ACTIVITIES:     Mfg of petroleum waxes, wax products, fuel oil

BRANCHES:     Osaka, Ibaraki, other (Tot 4)

FACTORIES:     Yamaguchi; Thailand

 

CHIEF EXEC:    HIROSHI INOUE, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 　                     A/SALES          Yen 35,974 M

PAYMENTS      SLOW BUT CORRECT   　         CAPITAL           Yen 1,120 M

TREND             SLOW              　                     WORTH            Yen 10,759 M

STARTED         1951                                         　EMPLOYES   233

 

COMMENT:       MFR OF PETROLEUM WAXES, WAX PRODUCTS  FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                       

 

Unit: In Million Yen

Forecast figures for the 31/12/2015 fiscal term.

 

 

HIGHLIGHTS

 

This is the oldest and largest mfr of petroleum waxes in Japan.  Procuring main materials, waxy topped crude oil, from Indonesia.  Also selling residue of crude oil (fuel oil) for electric utilities, and other industries.  Expanding imports of intermediate materials from Malaysia.  A variety of products are used in production of paper, tire rubber, toner, candle, etc, such as anti-ozone ant waxes.  Yoshihiko Fukuma, originally from JX Nippon Oil & Energy and having extensive familiarity with production site, became director.  He will lead efficiency improvement of the main plant in Tokuyama.  Maintains business and capital alliance with Itochu Corp.

 

 

FINANCIAL INFORMATION

 

The sales volume for Dec/2014 fiscal term amounted to Yen 35,974 million, a 9.0% down from Yen 39,543 million in the previous term.  In wax business, higher material cost hurt in the first half.  Fuel oil business faced decreased sales to thermal power plants.  Inventory valuation loss of some Yen 300 million was posted in the first half.  Operations plunged into the red to post Yen 217 million recurring loss and Yen 121 net losses, respectively, compared with Yen 275 million recurring profit and Yen 389 million net profit, respectively, a year ago.

 

For the current term ending Dec 2015 the recurring profit is projected at Yen 540 million and the net profit at Yen 420 million, on a 22.2% fall in turnover, to 28,000 million.  In wax business, domestic demand for tire’ and toner-related products is anticipated to decrease slightly.  Start-up costs related with a new consolidated subsidiary in Thailand may hurt.

 

The financial situation is considered FAIR and good for ORDINARY business engagements. 

 

 

REGISTRATION

           

Date Registered:　      Feb 1951

Regd No.:                                 0100-01-034983 (Tokyo-Chuoku)

Legal Status:               Limited Company (Kabushiki Kaisha

Authorized:                  89,600,000 million shares

Issued:                         22,400,000 shares

Sum:                            Yen 1,120 million

 

Major shareholders (%): Company’s Treasury Stock (20.0), Itochu Corp (8.6), Mitsubishi Corp (5.0), Seiji Kanda (2.9), Mitsubishi UFJ Trust Bank (2.4), Saikyo Bank (2.2), Sankyu Inc (2.0), ATS (1.8), Ando Parachemic (1.3), Tokki Co (1.3); foreign owners (0.4)

 

No. of shareholders: 2,098

 

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

 

Managements: Yoshida Yasukuni, ch: Hiroshi Inoue, pres; Toshio Saito, v pres; Shigenobu Nishida, v pres; Shoji Higashi, s/mgn dir; Hachiro Hosoda, mgn dir; Tadashi Sekiya, dir; Tsukasa Ando, dir; Yoshihiko Fukuma, dir; Naohiro Jokei, dir

 

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

 

 

OPERATION

           

Activities: Manufactures petroleum waxes, wax products (paraffin wax, microcrystalline wax, anti-ozone wax for rubber & tire), other (49%), fuel oil (residue of crude oil) (50%), others (1%)

 

Overseas Sales Ratio (17%)

           

Clients: [Oil refineries, wholesalers] Sasol Wax North America, Mitsubishi Corp, Chugoku Electric Power, Tokyo Electric Power, Meiwa Trading Co, Tokyo Oil & Fat Co, other

No. of accounts: 500

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] PPT, JX Nippon Oil & Energy Corp, Leef Energy KK, Kanematsu Petroleum Corp, Ueno Transtech, Komatsu Lift, Uni Carriers Corp, other

 

Payment record: Slow but correct

 

Location: Business area in Tokyo.  Office premises at the caption address are leased and maintained satisfactorily.

 

Bank References:

Mitsubishi UFJ Trust Bank (H/O)

Hiroshima Bank (Tokyo)

Relations: Satisfactory

 

 

FINANCES

 

 (In Million Yen)

FINANCES: (Consolidated in million yen)

　

　

　

Terms Ending:

31/12/2014

31/12/2013

INCOME STATEMENT

 

　

　

  Annual Sales

　

35,974

39,543

　

  Cost of Sales

34,065

36,971

　

      GROSS PROFIT

1,909

2,572

　

  Selling & Adm Costs

2,147

2,273

　

      OPERATING PROFIT

-237

299

　

  Non-Operating P/L

20

-24

　

      RECURRING PROFIT

-217

275

　

      NET PROFIT

-121

389

BALANCE SHEET

 

 

　

　

  Cash

　

942

350

　

  Receivables

 

4,834

4,817

　

  Inventory

 

10,450

10,320

　

  Securities, Marketable

　

　

　

  Other Current Assets

688

550

　

      TOTAL CURRENT ASSETS

16,914

16,037

　

  Property & Equipment

13,564

13,848

　

  Intangibles

 

164

219

　

  Investments, Other Fixed Assets

698

496

　

      TOTAL ASSETS

31,340

30,600

　

  Payables

 

1,423

1,109

　

  Short-Term Bank Loans

7,800

7,120

　

　

 

　

　

　

  Other Current Liabs

3,538

3,452

　

      TOTAL CURRENT LIABS

12,761

11,681

　

  Debentures

 

　

　

　

  Long-Term Bank Loans

4,334

4,337

　

  Reserve for Retirement Allw

67

98

　

  Other Debts

　

3,419

3,565

　

      TOTAL LIABILITIES

20,581

19,681

　

      MINORITY INTERESTS

 

　

　

Common stock

1,120

1,120

　

Additional paid-in capital

25

14

　

Retained earnings

5,118

5,423

　

Evaluation p/l on investments/securities

66

40

　

Others

 

5,567

5,567

　

Treasury stock, at cost

(1,137)

(1,245)

　

      TOTAL S/HOLDERS` EQUITY

10,759

10,919

　

      TOTAL EQUITIES

31,340

30,600

CONSOLIDATED CASH FLOWS

 

　

　

 

Terms ending:

31/12/2014

31/12/2013

　

Cash Flows from Operating Activities

　

587

932

　

Cash Flows from Investment Activities

-783

-494

　

Cash Flows from Financing Activities

756

-745

　

Cash, Bank Deposits at the Term End

　

942

350

ANALYTICAL RATIOS            Terms ending:

31/12/2014

31/12/2013

　

 

Net Worth (S/Holders' Equity)

10,759

10,919

　

 

Current Ratio (%)

132.54

137.29

　

 

Net Worth Ratio (%)

34.33

35.68

　

 

Recurring Profit Ratio (%)

-0.60

0.70

　

 

Net Profit Ratio (%)

-0.34

0.98

　

　

Return On Equity (%)

-1.12

3.56

 

 

           

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.66.16

UK Pound

1

Rs.103.88

Euro

1

Rs.75.89

 

 

INFORMATION DETAILS

 

Analysis Done by :

DIV

 

 

Report Prepared by :

ASH

 

               


 

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.