MIRA INFORM REPORT

 

 

Report No. :

355090

Report Date :

16.12.2015

 

IDENTIFICATION DETAILS

 

Name :

MITSUI & CO LTD

 

 

Registered Office :

Nihon Seimei Marunouchi Garden Tower, 1-1-3 Marunouchi Chiyodaku Tokyo 100-0005

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2015

 

 

Date of Incorporation :

July 1947

 

 

Com. Reg. No.:

0100-01-008767 

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Subject is engaged in import, export, wholesale of: iron & steel, metals, machinery, chemicals, foodstuffs, textiles, crude oil, fuels, electronics

 

 

No. of Employee :

47,118

 

RATING & COMMENTS

 

MIRA’s Rating :

Aa

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

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 – 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 & address

 

MITSUI & CO LTD

 

REGD NAME:               Mitsui Bussan KK

MAIN OFFICE:              Nihon Seimei Marunouchi Garden Tower, 1-1-3 Marunouchi Chiyodaku Tokyo                                                                                                 100-0005 JAPAN

                                                Tel: 03-3285-1111     Fax: 03-3285-9800

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

E-MAIL ADDRESS:       (through the URL to each division)

 

 

ACTIVITIES

 

Import, export, wholesale of: iron & steel, metals, machinery, chemicals, foodstuffs, textiles, crude oil,fuels,electronics.

 

 

BRANCHES

 

Domestic (12); Overseas (128: 32 offices & 96 subsidiaries))

 

 

CHIEF EXEC

 

TATSUO YASUNAGA, PRES & CEO

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 A/SALES          Yen 10,827,831 M                                             

PAYMENTSREGULAR   CAPITAL           Yen 341,482 M

TREND STEADY           WORTH            Yen 4,397,374 M

STARTED         1947                 EMPLOYES      47,118

 

 

COMMENT

 

JAPAN’S LEADING GENERAL TRADING HOUSE, NUCLEUS OF THE MITSUI GROUP. 

FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                       

 

Notes: US Standard in Million Yen

Forecast (or estimated) figures for 31/03/2016 fiscal term

 

 

HIGHLIGHTS

 

The subject company is an offshoot of Japan’s wealthiest merchant house of Edo era founded in 1600.  Now ranked one of the largest general trading houses of Japan vying with Mitsubishi Corp for top position.  Ranked 2nd in foodstuffs trade next to Mitsubishi Corp but 1st in chemicals.  Nucleus firm of the Mitsui group.  Handling items vary from metals & minerals, machinery, electronics & information, to chemicals, petrochemicals, plastics, foods, etc.  Traditionally strong in field of heavy industries.  Active in overseas business expansion such as oil/gas development in Russia and construction of large thermal power plant in Thailand.  Strengthening partnership strategy with US Douglas, Unisys and other big firms.  Stressing on natural resources, including LNG, and telecommunications sectors.  The company will invest around Yen 66 billion in the general cargo transportation business of Brazil-based Vale, with the aim of expanding the infrastructure business.  The copper mine in Chile will book Yen 14 billion in asset impairment due to swelling development costs.  The company plans to adopt IFRS from the March 2015 term.

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2015 fiscal term amounted to Yen 10,827,831 million, a 2.9% down from Yen 11,155,434 million in the previous term.  The recurring profit was posted at Yen 431,827 million and the net profit at Yen 306,924 million, respectively, compared with Yen 550,517 million recurring profit and Yen 350,093 million net profit, respectively, a year ago. 

 

(Apr/Jun/2015 results): Sales Yen 2,552,237 million (down 4.8%), recurring profit Yen 152,765 million (down 11.8%), net profit Yen 96,937 million (down 24.2%).  (% as compared with the corresponding period a year ago)

 

For the current term ending Mar 2016 the recurring profit is projected at Yen 390,000 million and the net profit at Yen 240,000 million, respectively, on a 5.6% fall in turnover, to Yen 10,221,470 million.  The slump in the metal business and the low oil prices will dampen earnings throughout the term. 

           

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

 

 

REGISTRATION

           

Date Registered:                       Jul 1947

Regd No.:                                 0100-01-008767 (Tokyo-Chiyodaku)

Legal Status:                Limited Company (Kabushiki Kaisha)

Authorized:                  2,500 million shares

Issued:                         1,829,153,527 shares

Sum:                            Yen 341,482 million

           

Major shareholders (%): Master Trust Bank of Japan, T (6.8), Japan Trustee Services Bank T (4.8), SMBC (2.1), Japan Trustee Services T9 (2.0), Nippon Life Ins (1.9), Bank of New York Treaty Jasdec (1.4), Barclays Securities Japan (1.3), Mitsui Sumitomo ins (1.3), Bank of New York Jasdec Treaty (1.1), JP Morgan Chase Bank 380055 (1.1):; foreign owners (30.5)

           

No. of shareholders: 298,998

 

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

 

Managements: Masami Iijima, ch; Tatsuo Yasunaga, pres; Daisuke Zoga, v pres; Masayuki Kinoshita, v pres; Shintaro Abe, v pres; Hiroyuki Kaga, s/mgn dir; Yoshihiro Hombo, s/mgn dir; Makoto Suzuki, s/mgn dir; Keigo Matsubara, mgn dir; Ikujiro Nonaka, dir; Hiroshi Hirabayashi, dir

 

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

 

Related companies: Mitsui & Co (USA), Mitsui Foods, Telepark Corp, other

 

 

OPERATION

 

Activities: A general trading house for import, export and wholesale of:

 

(Sales breakdown by divisions):

 

Metals (15%): iron ore, steel materials, ferroalloys, coal, coke, nonferrous metals, precious metals, electric wires, other;

 

Machinery & Information (8%): industrial machinery, automobiles, electronics & information equipment, office machines, other;

 

Chemicals (16%): organic & inorganic chemicals, petrochemicals, fine chemicals, fertilizers, other;

 

Energy (18%): crude oil, LNG, LPG, fuels, other petroleum products, other,

 

Lifestyle (18%): clothing, upholstery, fabrics, textile raw materials, other;

 

Steel Products (3%); steel slabs, billets, hot-rolled sheets, coated sheets, tin plates, electrical sheets, pipes, wire rods, automotive steel, stainless steel, other;

 

Others (22%): lumber, flooring, other construction materials, sporting goods, cereals, alcoholic beverages, other foodstuffs).

 

Overseas sales ratio (45%)

 

Clients: [Steel mills, mfrs, wholesalers] Mitsui Foods, Mitsui & Co Hong Kong, Mitsui Oil Hong Kong, Taiyo Kenki Rental Co, Kato Sangyo Co, Toray Ind, Tokyo Electric Power, Mitsui Engineering & Shipbuilding Ind, Mitsui Oil & Gas, Inpex Operations Australia, other.

No. of accounts: 2,000 – 3,000

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Mitsui Chemical, Mitsui Oil, Toshiba Corp, Toyota Motor, Fuji Heavy Ind, Abu Dhabi Gas Liquefaction, Mitsui & Co USA, Toyo Suisan Kaisha, other.

 

Payment record: Regular

 

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

 

Bank References:

SMBC (H/O)

Mizuho Bank (H/O)

Relations: Satisfactory

 

 

FINANCES

 

(In Million Yen) (US Standards）

FINANCES: (Consolidated in million yen)

　

　

　

Terms Ending:

31/03/20１５

31/03/2014

INCOME STATEMENT

　

　

  Annual Sales

　

5,404,930

5,731,918

　

  Cost of Sales

4,559,090

4,851,812

　

      GROSS PROFIT

845,840

880,106

　

  Selling & Adm Costs

655,570

609,322

　

      OPERATING PROFIT

190,270

270,784

　

  Non-Operating P/L

241,557

279,733

　

      RECURRING PROFIT

431,827

550,517

　

      NET PROFIT

306,490

350,093

BALANCE SHEET

　

　

  Cash

　

1,400,770

1,226,317

　

  Receivables

1,949,837

2,040,855

　

  Inventory

671,164

625,328

　

  Securities, Marketable

　

　

　

  Other Current Assets

708,752

572,913

　

      TOTAL CURRENT ASSETS

4,730,523

4,465,413

　

  Property & Equipment

2,148,142

2,007,452

　

  Intangibles

162,951

144,153

　

  Investments, Other Fixed Assets

5,161,305

4,874,301

　

      TOTAL ASSETS

12,202,921

11,491,319

　

  Payables

1,384,039

1,473,834

　

  Short-Term Bank Loans

290,641

436,869

　

　

　

　

　

  Other Current Liabs

1,166,461

1,073,948

　

      TOTAL CURRENT LIABS

2,841,141

2,984,651

　

  Debentures

　

　

　

  Long-Term Bank Loans

4,030,598

3,468,301

　

  Reserve for Retirement Allw

46,211

69,558

　

  Other Debts

　

887,597

868,505

　

      TOTAL LIABILITIES

7,805,547

7,391,015

　

      MINORITY INTERESTS

　

　

Common stock

341,482

341,482

　

Additional paid-in capital

411,881

418,004

　

Retained earnings

2,537,815

2,345,790

　

Evaluation p/l on investments/securities

814,563

766,631

　

Others

297,579

284,537

　

Treasury stock, at cost

(5,946)

(56,140)

　

      TOTAL S/HOLDERS` EQUITY

4,397,374

4,100,304

　

      TOTAL EQUITIES

12,202,921

11,491,319

CONSOLIDATED CASH FLOWS

　

　

Terms ending:

31/03/2015

31/03/2014

　

Cash Flows from Operating Activities

　

639,967

449,243

　

Cash Flows from Investment Activities

-386,397

-659,818

　

Cash Flows from Financing Activities

-126,193

-13,237

　

Cash, Bank Deposits at the Term End

　

1,400,770

1,226,317

ANALYTICAL RATIOS            Terms ending:

31/03/20１５

31/03/2014

　

Net Worth (S/Holders' Equity)

4,397,374

4,100,304

　

Current Ratio (%)

166.50

149.61

　

Net Worth Ratio (%)

36.04

35.68

　

Recurring Profit Ratio (%)

7.99

9.60

　

Net Profit Ratio (%)

5.67

6.11

　

　

Return On Equity (%)

6.97

8.54

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.67.04

UK Pound

1

Rs.101.67

Euro

1

Rs.73.93

JPY

1

Rs. 0.55

Note : Above are approximate rates obtained from sources believed to be correct

 

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

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.