MIRA INFORM REPORT

 

 

Report No. :

328753

Report Date :

22.06.2015

 

IDENTIFICATION DETAILS

 

Name :

FUJI ELECTRIC CO LTD

 

 

Registered Office :

Gate City Osaki East Tower, 1-11-2 Osaki Shinagawaku Tokyo 141-0032

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2015 - Consolidated

 

 

Date of Incorporation :

August, 1923

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Manufacturer of Heavy Electric Machinery.

 

 

No. of Employees :

25,740

 

 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

 

Maximum Credit Limit :

Yen 17,944.9 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 – 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 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

 

Company Name and address

 

FUJI ELECTRIC CO LTD

 

REGD NAME:               Fuji Denki KK

 

MAIN OFFICE:              Gate City Osaki East Tower, 1-11-2 Osaki Shinagawaku Tokyo 141-0032

                      JAPAN

                                                Tel: 03-5435-7111     Fax: 03-5435-7486

                       

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

E-Mail address:                        (thru the URL)

 

 

ACTIVITIES

 

Mfr of heavy electric machinery

 

 

BRANCHES

 

Nationwide (51 branches)

 

 

OVERSEAS

 

USA, Singapore, Thailand, Vietnam, Indonesia, India, Philippines, Malaysia, Taiwan, Korea, Bahrain, Myanmar, Cambodia, China, Hong Kong, Germany, France, other

 

 

FACTORIES

 

Kobe, Chiba, Ibaraki, Kawasaki, Mie, other (Tot 10)

 

 

CHIEF EXEC

 

MICHIHIRO KITAZAWA, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 　         A/SALES                      Yen 810,678 M

PAYMENTSREGULAR   　         CAPITAL                       Yen 47,586 M

TREND STEADY           　         WORTH                        Yen 319,636 M

STARTED         1923                 　         EMPLOYES                  25,740

 

 

COMMENT    

 

HEAVY ELECTRIC MACHINERY MFR. 

 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                       

MAX CREDIT LIMIT: YEN 17,944.9 MILLION, 30 DAYS NORMAL TERMS.

 

 

         Unit: In Million Yen

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

 

 

HIGHLIGHTS

 

The subject company is one of the top-ranked heavy electric machinery mfr. Originally JV formed in 1923by Furukawa Electric and Siemens. Mother company of Fujitsu Ltd. Maintaining higher shares in automatic vending machines and power semiconductors. Earnings concentrate in 2nd half each term. 

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2015 fiscal term amounted to Yen 810,678 million, a 6.7% up from Yen 759,911 million in the previous term.  Sales of power semiconductors did well.  Sales of industrial infrastructure-related products such as transforming equipment also expanded.  The recurring profit was posted at Yen 43,139 million and the net profit at Yen 27,978 million, respectively, compared with Yen 36,731 million recurring profit and Yen 19,582 million net profit, respectively, a year ago.

 

For the current term ending Mar 2016 the recurring profit is projected at Yen 45,000 million and the net profit at Yen 29,000 million, respectively, on a 4.9% rise in turnover, to Yen 850,000 million.  Sales of power semiconductors will continue growing, backed by brisk sales of industrial robots.  Demand for power generation-related products will rise as well. 

 

The financial situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen 17,944.9 million, on 30 days normal terms.

 

 

REGISTRATION

           

Date Registered:　Aug 1923

            Legal Status:          Limited Company (Kabushiki Kaisha)

            Authorized:            1,800 million shares

            Issued:                  746,484,957 shares

            Sum:                      Yen 47,586 million

           

Major shareholders (%): Fujitsu Ltd (9.9), Japan Trustee Services T (7.9), Master Trust Bank of Japan T (5.7), Company’s Treasury Stock (4.2), Mizuho Corporate Bank (2.9), Asahi Life Ins (2.6), Fanuc Ltd (1.7), Furukawa Co (1.4), Furukawa Electric (1.4), Chase London SL Omnibus Acct (1.3); foreign owners (27.8)

           

No. of shareholders: 34,567

 

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

 

Managements: Michihiro Kitazawa, pres; Yoshio Okuno, v pres; Michio Abe, s/mgn dir; Kenzo Sugai, mgn dir; Hiroaki Kurokawa, dir; Motoyuki Suzuki, dir; Mareto Sako, dir; Naoya Eguchi, dir; Jun’ichi Matsumoto, dir

 

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

 

Related companies: Fuji Electric Systems, Fuji Electric Device Technology, Fuji Electric Retail Systems, other

           

 

OPERATION

           

Activities: Manufactures heavy electric machineries:

 

(Sales by divisions):

Power generation & social infrastructure (20%): steam turbine, power generation facilities, fuel cells, cluster energy management system, electric power storage systems;

Industrial infrastructure (24%): substation equipment, rectification equipment, industrial drive systems, data centers, industrial measuring systems;

Power electric equipment (20%): general-purpose & industrial meters, synchronous drive systems, EV systems (quick chargers), uninterruptible power supply systems, magnetic switches/molded-case circuit breakers;

Electronics devices (16%): power semiconductors, organic photoconductive circuits, magnetic disks;

Others (20%)

Overseas Sales Ratio (23%):

 

Clients: [Mfrs, wholesalers] Sojitz Corp, Sumitomo Corp, Fujitsu Ltd, JFE Steel, Chubu Electric Power, Tokyo Electric Power, Denso Corp, Metawater Co, Nippon Steel & Sumitomo Meatal Corp, other

No. of accounts: 1,000

Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] Fuji Furukawa E&C, Fuji IT, Fuji IT Center, Nagase Corp,    Fuji Electric IT Center,  Fuji Electric F-Tech Co, other

 

Payment record: Regular

 

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

 

Bank References:

            Mizuho Bank (H/O)

            MUFG (H/O)

            Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

　

　

　

Terms Ending:

31/03/2015

31/03/2014

INCOME STATEMENT

　

　

  Annual Sales

　

810,678

759,911

　

  Cost of Sales

609,376

579,856

　

      GROSS PROFIT

201,302

180,055

　

  Selling & Adm Costs

161,985

146,918

　

      OPERATING PROFIT

39,316

33,136

　

  Non-Operating P/L

3,823

3,595

　

      RECURRING PROFIT

43,139

36,731

　

      NET PROFIT

27,978

19,582

BALANCE SHEET

　

　

  Cash

　

31,953

34,025

　

  Receivables

237,631

222,481

　

  Inventory

137,612

121,441

　

  Securities, Marketable

　

　

　

  Other Current Assets

55,773

51,391

　

      TOTAL CURRENT ASSETS

462,969

429,338

　

  Property & Equipment

174,953

172,619

　

  Intangibles

15,295

13,874

　

  Investments, Other Fixed Assets

251,305

194,943

　

      TOTAL ASSETS

904,522

810,774

　

  Payables

150,648

142,087

　

  Short-Term Bank Loans

68,095

76,412

　

　

　

　

　

  Other Current Liabs

186,005

140,958

　

      TOTAL CURRENT LIABS

404,748

359,457

　

  Debentures

45,500

60,500

　

  Long-Term Bank Loans

43,629

62,592

　

  Reserve for Retirement Allw

32,518

34,236

　

  Other Debts

　

58,490

42,763

　

      TOTAL LIABILITIES

584,885

559,548

　

      MINORITY INTERESTS

　

　

Common stock

48,586

47,586

　

Additional paid-in capital

46,735

46,734

　

Retained earnings

109,543

102,631

　

Evaluation p/l on investments/securities

69,528

44,768

　

Others

52,428

16,654

　

Treasury stock, at cost

(7,184)

(7,148)

　

      TOTAL S/HOLDERS` EQUITY

319,636

251,225

　

      TOTAL EQUITIES

904,522

810,774

CONSOLIDATED CASH FLOWS

　

　

Terms ending:

31/03/2015

31/03/2014

　

Cash Flows from Operating Activities

　

51,459

53,651

　

Cash Flows from Investment Activities

-22,750

-9,649

　

Cash Flows from Financing Activities

-33,828

-50,569

　

Cash, Bank Deposits at the Term End

　

31,895

33,412

ANALYTICAL RATIOS            Terms ending:

31/03/2015

31/03/2014

　

Net Worth (S/Holders' Equity)

319,636

251,225

　

Current Ratio (%)

114.38

119.44

　

Net Worth Ratio (%)

35.34

30.99

　

Recurring Profit Ratio (%)

5.32

4.83

　

Net Profit Ratio (%)

3.45

2.58

　

　

Return On Equity (%)

8.75

7.79


 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.63.82

UK Pound

1

Rs.101.26

Euro

1

Rs.72.36

 

INFORMATION DETAILS

 

Analysis Done by :

KAS

 

 

Report Prepared by :

NIT

 

 

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.