|
Report No. : |
353310 |
|
Report Date : |
14.12.2015 |
IDENTIFICATION DETAILS
|
Name : |
THE CHILDREN’S PLACE, INC. |
|
|
|
|
Registered Office : |
500 Plaza Drive, Secaucus, NJ 07094 |
|
|
|
|
Country : |
United States |
|
|
|
|
Date of Incorporation : |
03.06.1988 |
|
|
|
|
Legal Form : |
Public Company (Nasdaq = PLCE) |
|
|
|
|
Line of Business : |
|
|
|
|
|
Employees : |
3,900 |
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) |
|
United States |
A1 |
A1 |
|
Risk Category |
ECGC
Classification |
|
Insignificant |
A1 |
|
Low |
A2 |
|
Moderate |
B1 |
|
High |
B2 |
|
Very High |
C1 |
|
Restricted |
C2 |
|
Off-credit |
D |
UNITED STATES - ECONOMIC OVERVIEW
The US has the most technologically powerful economy in the world, with
a per capita GDP of $54,800. US firms are at or near the forefront in technological
advances, especially in computers, pharmaceuticals, and medical, aerospace, and
military equipment; however, their advantage has narrowed since the end of
World War II. Based on a comparison of GDP measured at Purchasing Power Parity
conversion rates, the US economy in 2014, having stood as the largest in the
world for more than a century, slipped into second place behind China, which
has more than tripled the US growth rate for each year of the past four
decades.
In the US, private individuals and business firms make most of the
decisions, and the federal and state governments buy needed goods and services
predominantly in the private marketplace. US business firms enjoy greater
flexibility than their counterparts in Western Europe and Japan in decisions to
expand capital plant, to lay off surplus workers, and to develop new products.
At the same time, they face higher barriers to enter their rivals' home markets
than foreign firms face entering US markets.
Long-term problems for the US include stagnation of wages for
lower-income families, inadequate investment in deteriorating infrastructure,
rapidly rising medical and pension costs of an aging population, energy
shortages, and sizable current account and budget deficits.
The onrush of technology has been a driving factor in the gradual
development of a "two-tier" labor market in which those at the bottom
lack the education and the professional/technical skills of those at the top
and, more and more, fail to get comparable pay raises, health insurance
coverage, and other benefits. But the globalization of trade, and especially
the rise of low-wage producers such as China, has put additional downward
pressure on wages and upward pressure on the return to capital. Since 1975,
practically all the gains in household income have gone to the top 20% of
households. Since 1996, dividends and capital gains have grown faster than
wages or any other category of after-tax income.
Imported oil accounts for nearly 55% of US consumption and oil has a
major impact on the overall health of the economy. Crude oil prices doubled
between 2001 and 2006, the year home prices peaked; higher gasoline prices ate
into consumers' budgets and many individuals fell behind in their mortgage
payments. Oil prices climbed another 50% between 2006 and 2008, and bank
foreclosures more than doubled in the same period. Besides dampening the
housing market, soaring oil prices caused a drop in the value of the dollar and
a deterioration in the US merchandise trade deficit, which peaked at $840
billion in 2008.
The sub-prime mortgage crisis, falling home prices, investment bank
failures, tight credit, and the global economic downturn pushed the United
States into a recession by mid-2008. GDP contracted until the third quarter of
2009, making this the deepest and longest downturn since the Great Depression.
To help stabilize financial markets, the US Congress established a $700 billion
Troubled Asset Relief Program (TARP) in October 2008. The government used some
of these funds to purchase equity in US banks and industrial corporations, much
of which had been returned to the government by early 2011. In January 2009 the
US Congress passed and President Barack OBAMA signed a bill providing an
additional $787 billion fiscal stimulus to be used over 10 years - two-thirds
on additional spending and one-third on tax cuts - to create jobs and to help
the economy recover. In 2010 and 2011, the federal budget deficit reached
nearly 9% of GDP. In 2012, the federal government reduced the growth of
spending and the deficit shrank to 7.6% of GDP. US revenues from taxes and
other sources are lower, as a percentage of GDP, than those of most other
countries.
Wars in Iraq and Afghanistan required major shifts in national resources
from civilian to military purposes and contributed to the growth of the budget
deficit and public debt. Through 2014, the direct costs of the wars totaled
more than $1.5 trillion, according to US Government figures.
In March 2010, President OBAMA signed into law the Patient Protection
and Affordable Care Act, a health insurance reform that was designed to extend
coverage to an additional 32 million American citizens by 2016, through private
health insurance for the general population and Medicaid for the impoverished.
Total spending on health care - public plus private - rose from 9.0% of GDP in
1980 to 17.9% in 2010.
In July 2010, the president signed the DODD-FRANK Wall Street Reform and
Consumer Protection Act, a law designed to promote financial stability by
protecting consumers from financial abuses, ending taxpayer bailouts of
financial firms, dealing with troubled banks that are "too big to
fail," and improving accountability and transparency in the financial
system - in particular, by requiring certain financial derivatives to be traded
in markets that are subject to government regulation and oversight.
In December 2012, the Federal Reserve Board (Fed) announced plans to
purchase $85 billion per month of mortgage-backed and Treasury securities in an
effort to hold down long-term interest rates, and to keep short term rates near
zero until unemployment dropped below 6.5% or inflation rose above 2.5%. In
late 2013, the Fed announced that it would begin scaling back long-term bond
purchases to $75 billion per month in January 2014 and reduce them further as
conditions warranted; the Fed ended the purchases during the summer of 2014. In
2014, the unemployment rate dropped to 6.2%, and continued to fall to 5.5% by
mid-2015, the lowest rate of joblessness since before the global recession
began; inflation stood at 1.7%, and public debt as a share of GDP continued to
decline, following several years of increase.
|
Source
: CIA |
Company name: THE CHILDREN’S PLACE, INC.
Address: 500 Plaza Drive, Secaucus, NJ 07094
- USA
Telephone: +1
201-558-2400
Fax: +1 201-558-2630
Website: www.childrensplace.com
Corporate ID#: 2162654
State: Delaware
Judicial form: Public Company (Nasdaq = PLCE)
Date incorporated: June 3,
1988
Stock: 19,967,195
shares issued and outstanding (as of December 7, 2015)
Value: USD
0.10= par value
Name of manager: Jane
T. ELFERS
Business:
The Children’s Place, Inc. operates as a children's specialty apparel
retailer.
The company sells apparel, accessories, footwear, and other items for
children; and designs, contracts to manufacture, and sells merchandise under
the proprietary The Children's Place, Place, and Baby Place brand names.
As of October 31, 2015, it operated 1,085 stores in the United States,
Canada, and Puerto Rico; and 90 international stores that are operated by its
franchise partners. The company also sells its products through operating an
online store at childrensplace.com.
The company was formerly known as The Children’s Place Retail Stores,
Inc. and changed its name to The Children's Place, Inc. in June 2014.
The Children's Place, Inc. was founded in 1969 and is based in Secaucus,
New Jersey.
Office of the Foreign
Assets Control (OFAC):
The company is not listed on the OFAC list.
The Specially Designated Nationals (SDN) List is a publication of OFAC
which lists individuals and organizations with whom United States citizens and
permanent residents are prohibited from doing business.
EIN: 31-1241495
Staff: 3,900
Operations & branches:
At the headquarters, we
find the corporate office.
Shareholders:
The Company is listed with
the Nasdaq under symbol PLCE.
As of 09-30-2015, +99% of
the stock was held by institutional and mutual fund owners, including:
|
Royce & Associates, LLC |
10.08% |
|
Vanguard Group, Inc. (The) |
7.84% |
|
AllianceBernstein, L.P. |
7.46% |
|
Dimensional Fund Advisors LP |
6.84% |
|
BlackRock Fund Advisors |
5.87% |
Management:
Jane T. ELFERS has been the Chief Executive Officer and President of The
Children's Place, Inc. since April 4, 2010. Ms. Elfers served as the President
and Chief Executive Officer of Lord & Taylor, L.L.C., a part of May
Department Stores Co. until October 6, 2008. She is a 25-year retail executive
with an impressive track record. She began her retail career at Macy's Inc.
rising to buyer. Ms. Elfers has been a Director of The Children's Place, Inc.
since April 4, 2010. She also serves as a Member of the Board of Trustees at
Bucknell University.
Ms. Elfers served as a Director of The Partnership For New York City,
Inc.
Ms. Elfers earned a Bachelor of Science degree in Business
Administration from Bucknell University.
Michael SCARPA is Executive Vice President and COO.
Anurup PRUTHI is the CFO.
Subsidiaries
And partnership: Several
in the U.S. and worldwide.
On December 8, 2015, The Children's Place, Inc. reported unaudited
consolidated earnings results for the third quarter and nine months ended
October 31, 2015.
For the quarter, the company reported net sales of $455.913 million
compared to $487.304 million a year ago. The comparison to the third quarter of
2014 was negatively impacted by foreign exchange of $9.9 million. On a
constant-currency basis, net sales were $466 million, a 4.4% decrease compared
to net sales of $487 million in the third quarter of 2014. Operating income was
$57.647 million compared to $55.803 million a year ago. Income before taxes
were $57.393 million compared to $55.721 million a year ago. Net income was
$38.495 million compared to $36.942 million a year ago. Diluted earnings per
share were $1.88 compared to $1.70 a year ago. Adjusted net income was $39.612
million compared to $39.574 million a year ago. Adjusted net income per common
share was $1.93 compared to $1.82 a year ago. The comparison to the third
quarter of 2014 was negatively impacted by $0.08 due to foreign exchange.
On a constant-currency basis, adjusted earnings per diluted share were
$2.01, a 10.4% increase compared to the third quarter of 2014. Adjusted
operating income was $59.509 million compared to $60.096 million a year ago.
For the nine months, the company reported net sales of $1,227.233
million compared to $1,282.081 million a year ago. Operating income was $60.733
million compared to $59.389 million a year ago. Income before taxes were
$60.098 million compared to $59.266 million a year ago. Net income was $40.411
million compared to $39.851 million a year ago. Diluted earnings per share were
$1.94 compared to $1.81 a year ago. Adjusted net income was $50.516 million
compared to $46.679 million a year ago. Adjusted net income per common share
was $2.42 compared to $2.12 a year ago. Adjusted operating income was $77.358
million compared to $70.329 million a year ago. Net cash provided by operating
activities were $85.061 million compared to $68.556 million a year ago. For the
fourth quarter of 2015, the company expects adjusted net income per diluted
share between $0.93 and $1.03, inclusive of an estimated $(0.03) negative
impact from foreign exchange. This compares to adjusted net income per diluted
share of $0.94 in the fourth quarter of 2014. This guidance assumes that
comparable retail sales for the fourth quarter will increase low single digits.
On a constant-currency basis, adjusted EPS is projected to be $0.96 to $1.06
per share compared to $0.94 per share in the fourth quarter of 2014. The
company is reaffirming its adjusted net income per diluted share guidance for
fiscal 2015 in the range of $3.35 to $3.45, inclusive of a ($0.14) negative
impact from foreign exchange. This compares to adjusted net income per diluted
share of $3.05 in fiscal 2014. This guidance assumes that comparable retail
sales for the year will be slightly negative compared to fiscal 2014. On a
constant-currency basis, adjusted EPS is projected to be $3.49 to $3.59 per
share compared to $3.05 per share in fiscal 2014. The company expects
comparable retail sales for the year to be slightly negative compared to last
year. Adjusted gross margin is expected to leverage 60 to 70 basis points
compared to 2014. The company expects depreciation for the full year 2015 to be
approximately $63 million.
The company expects tax rate to be approximately 34% for the year. The
company continued to forecast another year of strong cash from operations in
2015. CapEx is expected to be approximately $55 million to $60 million for the
year. For the third quarter 2015, the company reported asset impairment charges
of $0.919 million compared to $3.306 million a year ago. The company is on
track to close an additional 14 stores in the fourth quarter of fiscal 2016,
bringing the total number of closed stores under the fleet optimization program
to 106. The company expects to open 4 stores and close approximately 30 stores
in 2015.
Banks: Wells Fargo Bank
Bank of America
JPMorgan Chase Bank
Legal filings & complaints:
State: Colorado
Case number: 1:15-cv-01288-REB-MJW
Plaintiff: Crocs, Inc.
Defendant: Children's Place, Inc., The et al
Robert E. Blackburn, presiding
Michael J. Watanabe, referral
Date filed: 06/17/2015
Date of last filing: 11/13/2015
Cause: Patent infringement
Secured debts summary (UCC):
Several
Haut du formulaire
Trade references:
Date reported: November 2015
High credit: USD 100,000+
Now owing: 0
Past due: 0
Last purchase: October 2015
Line of business: Office supply
Paying status: 25 days beyond terms
Date reported: November 2015
High credit: USD 4,500,000
Now owing: 0
Past due: 0
Last purchase: October 2015
Line of business: Payroll
Paying status: As agreed
Date reported: November 2015
High credit: USD 12,000
Now owing: 0
Past due: 0
Last purchase: October 2015
Line of business: Telecommunications
Paying status: 15 days beyond terms
Domestic credit history:
Domestic credit history
appears as follow:
|
Monthly Payment Trends - Recent Activity |
|
Date |
Up to 30 DBT |
31-60 DBT |
61-90 DBT |
>90 DBT |
||
|
06/15 |
$572,500 |
71% |
13% |
0% |
0% |
16% |
|
07/15 |
$1,126,800 |
74% |
20% |
5% |
0% |
1% |
|
08/15 |
$1,413,500 |
41% |
45% |
13% |
0% |
1% |
|
09/15 |
$1,075,200 |
36% |
7% |
55% |
0% |
2% |
|
10/15 |
$1,177,900 |
27% |
22% |
50% |
0% |
1% |
National Credit Bureaus
gave a medium credit risk.
According to our credit analysts, during the last 6 months, domestic
payments were made with an average of 25+ days beyond terms.
International
credit history:
Payments of imports are currently made with an average of 5 days beyond
terms.
Other comments:
The Company maintains a
regular business.
The bank confirmed
The Company is in good
standing.
This means that all local
and federal taxes were paid on due date.
The risk is medium.
Our opinion:
A business connection may
be conducted but we suggest you to check regularly the way of payments.
Standard & Poor’s
|
United
States of America Long-Term Rating Lowered To 'AA+' Due To Political Risks,
Rising Debt Burden; Outlook Negative |
|
Publication
date: 05-Aug-2011 20:13:14 EST |
·
We have also removed both the short- and long-term ratings
from CreditWatch negative.
·
The downgrade reflects our opinion that the fiscal
consolidation plan that Congress and the Administration recently agreed to
falls short of what, in our view, would be necessary to stabilize the
government's medium-term debt dynamics.
·
More broadly, the downgrade reflects our view that the effectiveness,
stability, and predictability of American policymaking and political
institutions have weakened at a time of ongoing fiscal and economic challenges
to a degree more than we envisioned when we assigned a negative outlook to the
rating on April 18, 2011.
·
Since then, we have changed our view of the difficulties in
bridging the gulf between the political parties over fiscal policy, which makes
us pessimistic about the capacity of Congress and the Administration to be able
to leverage their agreement this week into a broader fiscal consolidation plan
that stabilizes the government's debt dynamics any time soon.
·
The outlook on the long-term rating is negative. We could
lower the long-term rating to 'AA' within the next two years if we see that
less reduction in spending than agreed to, higher interest rates, or new fiscal
pressures during the period result in a higher general government debt
trajectory than we currently assume in our base case.
TORONTO (Standard &
Poor's) Aug. 5, 2011--Standard & Poor's Ratings Services said today that it
lowered its long-term sovereign credit rating on the United States of America
to 'AA+' from 'AAA'. Standard & Poor's also said that the outlook on the
long-term rating is negative. At the same time, Standard & Poor's affirmed
its 'A-1+' short-term rating on the U.S. In addition, Standard & Poor's
removed both ratings from CreditWatch, where they were placed on July 14, 2011,
with negative implications.
The
transfer and convertibility (T&C) assessment of the U.S.--our assessment of
the likelihood of official interference in the ability of U.S.-based public-
and private-sector issuers to secure foreign exchange for
debt service--remains
'AAA'.
We lowered our long-term
rating on the U.S. because we believe that the prolonged controversy over
raising the statutory debt ceiling and the related fiscal policy debate
indicate that further near-term progress containing the growth in public
spending, especially on entitlements, or on reaching an agreement on raising
revenues is less likely than we previously assumed and will remain a
contentious and fitful process. We also believe that the fiscal consolidation
plan that Congress and the Administration agreed to this week falls short of
the amount that we believe is necessary to stabilize the general government
debt burden by the middle of the decade.
Our lowering of the
rating was prompted by our view on the rising public debt burden and our
perception of greater policymaking uncertainty, consistent with our criteria
(see "Sovereign Government Rating Methodology and Assumptions
," June 30, 2011, especially Paragraphs 36-41). Nevertheless, we view the U.S.
federal government's other economic, external, and monetary credit attributes,
which form the basis for the sovereign rating, as broadly unchanged.
We have taken the ratings
off CreditWatch because the Aug. 2 passage of the Budget Control Act Amendment
of 2011 has removed any perceived immediate threat of payment default posed by
delays to raising the government's debt ceiling. In addition, we believe that
the act provides sufficient clarity to allow us to evaluate the likely course
of U.S. fiscal policy for the next few years.
The
political brinksmanship of recent months highlights what we see as America's
governance and policymaking becoming less stable, less effective, and less
predictable than what we previously believed. The statutory debt ceiling and
the threat of default have become political bargaining chips in the debate over
fiscal policy. Despite this year's wide-ranging debate, in our view, the
differences between political parties have proven to be extraordinarily
difficult to bridge, and, as we see it, the resulting agreement fell well short
of the comprehensive fiscal consolidation program that some proponents had
envisaged until quite recently. Republicans and Democrats have only been able
to agree to relatively modest savings on discretionary spending while
delegating to the Select Committee decisions on more comprehensive measures. It
appears that for now, new revenues have dropped down on the menu of policy
options. In addition, the plan envisions only minor policy changes on Medicare and
little change in other entitlements,
the containment of which
we and most other independent observers regard as key to long-term fiscal
sustainability.
Our opinion is that
elected officials remain wary of tackling the structural issues required to effectively
address the rising U.S. public debt burden in a manner consistent with a 'AAA'
rating and with 'AAA' rated sovereign peers (see Sovereign Government Rating Methodology and Assumptions,"
June 30, 2011, especially Paragraphs 36-41). In our view, the difficulty in
framing a consensus on fiscal policy weakens the government's ability to manage
public finances and diverts attention from the debate over how to achieve more
balanced and dynamic economic growth in an era of fiscal stringency and
private-sector deleveraging (ibid). A new political consensus might (or might
not) emerge after the 2012 elections, but we believe that by then, the
government debt burden will likely be higher, the needed medium-term fiscal
adjustment potentially greater, and the inflection point on the U.S.
population's demographics and other age-related spending drivers closer at hand
(see "Global Aging 2011: In The U.S., Going Gray Will Likely Cost Even
More Green, Now," June 21, 2011).
Standard & Poor's
takes no position on the mix of spending and revenue measures that Congress and
the Administration might conclude is appropriate for putting the U.S.'s
finances on a sustainable footing.
The act calls for as much
as $2.4 trillion of reductions in expenditure growth over the 10 years through
2021. These cuts will be implemented in two steps: the $917 billion agreed to
initially, followed by an additional $1.5 trillion that the newly formed
Congressional Joint Select Committee on Deficit Reduction is supposed to
recommend by November 2011. The act contains no measures to raise taxes or
otherwise enhance revenues, though the committee could recommend them.
The act further provides
that if Congress does not enact the committee's recommendations, cuts of $1.2
trillion will be implemented over the same time period. The reductions would mainly
affect outlays for civilian discretionary spending, defense, and Medicare. We
understand that this fall-back mechanism is designed to encourage Congress to
embrace a more balanced mix of expenditure savings, as the committee might
recommend.
We note that in a letter
to Congress on Aug. 1, 2011, the Congressional Budget Office (CBO) estimated
total budgetary savings under the act to be at least $2.1 trillion over the
next 10 years relative to its baseline assumptions. In updating our own fiscal
projections, with certain modifications outlined below, we have relied on the
CBO's latest "Alternate Fiscal Scenario" of June 2011, updated to
include the CBO assumptions contained in its Aug. 1 letter to Congress. In
general, the CBO's "Alternate Fiscal Scenario" assumes a continuation
of recent Congressional action overriding existing law.
We view the act's
measures as a step toward fiscal consolidation. However, this is within the
framework of a legislative mechanism that leaves open the details of what is finally
agreed to until the end of 2011, and Congress and the Administration could
modify any agreement in the future. Even assuming that at least $2.1 trillion
of the spending reductions the act envisages are implemented, we maintain our
view that the U.S. net general government debt burden (all levels of government
combined, excluding liquid financial assets) will likely continue to grow.
Under our revised base case fiscal scenario--which we consider to be consistent
with a 'AA+' long-term rating and a negative outlook--we now project that net
general government debt would rise from an estimated 74% of GDP by the end of
2011 to 79% in 2015 and 85% by 2021. Even the projected 2015 ratio of sovereign
indebtedness is high in relation to those of peer credits and, as noted, would
continue to rise under the act's revised policy settings.
Compared with previous
projections, our revised base case scenario now assumes that the 2001 and 2003
tax cuts, due to expire by the end of 2012, remain in place. We have changed
our assumption on this because the majority of Republicans in Congress continue
to resist any measure that would raise revenues, a position we believe Congress
reinforced by passing the act. Key macroeconomic assumptions in the base case
scenario include trend real GDP growth of 3% and consumer price inflation near
2% annually over the decade.
Our revised upside
scenario--which, other things being equal, we view as consistent with the
outlook on the 'AA+' long-term rating being revised to stable--retains these
same macroeconomic assumptions. In addition, it incorporates $950 billion of
new revenues on the assumption that the 2001 and 2003 tax cuts for high earners
lapse from 2013 onwards, as the Administration is advocating. In this scenario,
we project that the net general government debt would rise from an estimated
74% of GDP by the end of 2011 to 77% in 2015 and to 78% by 2021.
Our revised downside
scenario--which, other things being equal, we view as being consistent with a
possible further downgrade to a 'AA' long-term rating--features less-favorable
macroeconomic assumptions, as outlined below and also assumes that the second
round of spending cuts (at least $1.2 trillion) that the act calls for does not
occur. This scenario also assumes somewhat higher nominal interest rates for
U.S. Treasuries. We still believe that the role of the U.S. dollar as the key
reserve currency confers a government funding advantage, one that could change
only slowly over time, and that Fed policy might lean toward continued loose
monetary policy at a time of fiscal tightening. Nonetheless, it is possible
that interest rates could rise if investors re-price relative risks. As a
result, our alternate scenario factors in a 50 basis point (bp)-75 bp rise in
10-year bond yields relative to the base and upside cases from 2013 onwards. In
this scenario, we project the net public debt burden would rise from 74% of GDP
in 2011 to 90% in 2015 and to 101% by 2021.
Our revised scenarios
also take into account the significant negative revisions to historical GDP
data that the Bureau of Economic Analysis announced on July 29. From our
perspective, the effect of these revisions underscores two related points when
evaluating the likely debt trajectory of the U.S. government. First, the revisions
show that the recent recession was deeper than previously assumed, so the GDP
this year is lower than previously thought in both nominal and real terms.
Consequently, the debt burden is slightly higher. Second, the revised data
highlight the sub-par path of the current economic recovery when compared with
rebounds following previous post-war recessions. We believe the sluggish pace
of the current economic recovery could be consistent with the experiences of
countries that have had financial crises in which the slow process of debt
deleveraging in the private sector leads to a persistent drag on demand. As a
result, our downside case scenario assumes relatively modest real trend GDP
growth of 2.5% and inflation of near 1.5% annually going forward.
When comparing the U.S.
to sovereigns with 'AAA' long-term ratings that we view as relevant
peers--Canada, France, Germany, and the U.K.--we also observe, based on our
base case scenarios for each, that the trajectory of the U.S.'s net public debt
is diverging from the others. Including the U.S., we estimate that these five
sovereigns will have net general government debt to GDP ratios this year
ranging from 34% (Canada) to 80% (the U.K.), with the U.S. debt burden at 74%.
By 2015, we project that their net public debt to GDP ratios will range between
30% (lowest, Canada) and 83% (highest, France), with the U.S. debt burden at
79%. However, in contrast with the U.S., we project that the net public debt
burdens of these other sovereigns will begin to decline, either before or by
2015.
Standard & Poor's
transfer T&C assessment of the U.S. remains 'AAA'. Our T&C assessment
reflects our view of the likelihood of the sovereign restricting other public
and private issuers' access to foreign exchange needed to meet debt service.
Although in our view the credit standing of the U.S. government has
deteriorated modestly, we see little indication that official interference of
this kind is entering onto the policy agenda of either Congress or the
Administration. Consequently, we continue to view this risk as being highly
remote.
The outlook on the
long-term rating is negative. As our downside alternate fiscal scenario
illustrates, a higher public debt trajectory than we currently assume could
lead us to lower the long-term rating again. On the other hand, as our upside
scenario highlights, if the recommendations of the Congressional Joint Select
Committee on Deficit Reduction--independently or coupled with other
initiatives, such as the lapsing of the 2001 and 2003 tax cuts for high
earners--lead to fiscal consolidation measures beyond the minimum mandated, and
we believe they are likely to slow the deterioration of the government's debt
dynamics, the long-term rating could stabilize at 'AA+'.
FOREIGN EXCHANGE RATES
|
Currency |
Unit
|
Indian Rupees |
|
US Dollar |
1 |
Rs.66.79 |
|
|
1 |
Rs.101.10 |
|
Euro |
1 |
Rs.73.10 |
|
USD |
1 |
Rs.67.10 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
|
Analysis Done by
: |
KAR |
|
|
|
|
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.