MIRA INFORM REPORT

 

 

Report No. :

313477

Report Date :

23.03.2015

 

IDENTIFICATION DETAILS

 

Name :

DENSO CORPORATION

 

 

Formerly Known as : 

Nippon Denso Co., Ltd.

 

 

Registered Office :

1-1 Showacho Kariya city Aichi 448-0029

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2014 (Consolidated)

 

 

Date of Incorporation :

December 1949

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

·         Engaged as supplier of Advanced Automotive Technology, Systems and components for the major automakers.

·         Subject products lines are Thermal Systems, Power Train Control Systems, Electronic Systems, Electric Motors, Industrial Systems & Consumer Products

 

 

No of Employees :

51,135

 

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 :

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 – December 31, 2014

 

Country Name

Previous Rating

(30.09.2014)

Current Rating

(31.12.2014)

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 a technologically 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. Japan's industrial sector is heavily dependent on imported raw materials and 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 spectacular - 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 after effects 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 three times since 2008. A sharp downturn in business investment and global demand for Japan's exports in late 2008 pushed Japan into recession. 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 disrupted manufacturing. The economy has largely recovered in the two years since the disaster, but reconstruction in the Tohoku region has been uneven. Prime Minister Shinzo ABE has declared the economy his government's top priority; he has overturned his predecessor's plan to permanently close nuclear power plants and is pursuing an economic revitalization agenda of fiscal stimulus, monetary easing, and structural reform. Japan joined the Trans Pacific Partnership 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 2013 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. The new government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which is exceeding 230% of GDP. To help raise government revenue and reduce public debt, Japan decided in 2013 to gradually increase the consumption tax to a total of 10% by the year 2015. Japan is making progress on ending deflation due to a weaker yen and higher energy costs, but reliance on exports to drive growth and an aging, shrinking population pose other major long-term challenges for the economy.

 

Source : CIA

 

 

Company name

 

DENSO CORPORATION

 

 

REGD NAME

 

KK DENSO

 

 

MAIN OFFICE

 

1-1 Showacho Kariya city Aichi 448-0029 JAPAN

Tel: 0566-25-5511     Fax: no available on the general information   

 

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

E-Mail address:            (thru the URL)

 

 

ACTIVITIES

 

·         Engaged as supplier of Advanced Automotive Technology, Systems and components for the major automakers.

·         Subject products ranges are Thermal Systems, Power Train Control Systems, Electronic Systems, Electric Motors, Industrial Systems & Consumer Products

 

 

BRANCHES

 

Tokyo, Utsunomiya(Tochigi), Osaka, Hiroshima

 

 

FACTORIES

 

Kariya(Aichi), Anjou(Aichi), Nishio(Aichi), Toyohashi(Aichi), Inabe(Mie), other

 

 

CHIEF EXEC

 

NOBUAKI KATO, PRES

           

Yen Amount:     In million Yen, unless otherwise stated

 


SUMMARY

 

FINANCES        FAIR                 A/SALES          Yen 4,095,925 M

PAYMENTSREGULAR   CAPITAL           Yen 187,457 M

TREND UP                    WORTH           Yen 2,823,346 M

STARTED         1949                 EMPLOYES      51,135

 

 

COMMENT

 

MANUFACTURER/DEVELOPER OF AUTOMOTIVE COMPONENTS. 

 

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

3,131,460

207,228

143,033

(%)

2,072,443

(Consolidated)

31/03/2012

3,154,630

180,754

89,298

0.74

2,117,201

31/03/2013

3,580,923

296,017

181,682

13.51

2,426,861

31/03/2014

4,095,925

419,571

287,388

14.38

2,823,346

31/03/2015

4,270,000

400,000

264,000

1.08

  3,087,346

            Forecast (or estimated) figures for 2015 term.

     *..Unit: Million Yen

 

 

HIGHLIGHTS

 

After becoming independent from Toyota Motors, the subject company was founded as Nippon Denso Co., Ltd. in 1949. The company name was changed from Nippon Denso Co., Ltd. to Denso Corp. in 1996. It is a leading supplier of advanced automotive technology, systems and components for the major automakers. It’s mainly products are thermal systems, power train control systems, electronic systems, electric motors, industrial systems & consumer products. Since 2009, it is the world’s biggest auto-parts manufacturer by revenue.

 

 

FINANCIAL INFORMATION

 

The sales volume for March/2014 fiscal term amounted to Yen 4,095 million, a 14% up from Yen 3,580 million in the previous term.  The recurring profit was posted at Yen 420 million and the net profit at Yen 287 million, respectively, compared with Yen 296 million recurring profit and Yen 182 million net profit, respectively, a year ago.

 

For the current term ending March 2015 the recurring profit is projected at Yen 400 million and the net profit at Yen 264 million, respectively, on a 1% rise in turnover, to Yen 4,270 million.  Final results are yet to be released.  Profit is estimated to be decreased due to weak Yen trend.

 

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

 

 

REGISTRATION

 

Date Registered:                  December 1949

Legal Status:               Limited Company (Kabushiki Kaisha)

Authorized:                              1,500 million shares

Issued:                         884 million shares

Sum:                            Yen 187,457 million

 

Major shareholders (%): Toyota Motors(22.3), Toyota Shokki(7.9), Towa Realestate(3.8)

 

No. of shareholders: 51,135

 

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

 

Managements: 

NOBUAKI KATO, PRES

Koichi Fukaya, ch             Masahiko Miyaki, vp

Koji Kobayashi, vp           Akio Shikamura, vp

Haruya Maruyama, vp        Shinji Shirasaki, dir

Akio Tajima, dir               Michio Adachi, dir

Hiroyuki Wakabayashi, dir      Satoshi Iwata, dir

Masahiko Ito, dir              Shoichiro Toyota, dir

 

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

 

Related companies: Kyosan, Anden, Hamanako and others

 

 

OPERATION

           

Activities: mfg/developing of automotive components

           

Clients: [Mfrs, wholesalers] Toyota Motors Corp, Honda Motor Corp, Mazda Motor Corp, Daihatsu Motor Corp, Fuji Heavy Industry Corp and others

            No. of accounts: Unavailable

            Domestic areas of activities: Nationwide

 

Suppliers: Oki Densen, Hitachi Densen, 3M Japan and others

 

Payment record: Regular

 

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

 

Bank References:

MUFG (Nagoya)

SMBC

Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

 

 

 

Terms Ending:

31/03/2014

31/03/2013

INCOME STATEMENT

 

 

  Annual Sales

4,095,925

3,580,923

 

  Cost of Sales

3,341,834

3,007,614

 

      GROSS PROFIT

754,091

573,309

 

  Selling & Adm Costs

376,395

310,933

 

      OPERATING PROFIT

377,696

262,376

 

  Non-Operating P/L

41,875

33,641

 

      RECURRING PROFIT

419,571

296,017

 

      NET PROFIT

287,388

181,682

BALANCE SHEET

 

 

  Cash

 

607,618

665,152

 

  Receivables

644,559

586,312

 

  Inventory

422,425

370,662

 

  Securities, Marketable

426,490

430,052

 

  Other Current Assets

240,555

229,708

 

      TOTAL CURRENT ASSETS

2,341,647

2,281,886

 

  Property & Equipment

1,043,676

886,160

 

  Intangibles

23,941

15,456

 

  Investments, Other Fixed Assets

1,033,243

795,591

 

      TOTAL ASSETS

4,442,507

3,979,093

 

  Payables

493,933

456,603

 

  Short-Term Bank Loans

87,165

56,272

 

 

 

 

 

  Other Current Liabs

449,918

460,671

 

      TOTAL CURRENT LIABS

1,031,016

973,546

 

  Debentures

 

 

 

  Long-Term Bank Loans

228,578

261,248

 

  Reserve for Retirement Allw

1,669

199,059

 

  Other Debts

357,898

118,379

 

      TOTAL LIABILITIES

1,619,161

1,552,232

 

      MINORITY INTERESTS

 

 

Common stock

187,457

187,457

 

Additional paid-in capital

269,497

267,332

 

Retained earnings

2,184,238

1,933,814

 

Evaluation p/l on investments/securities

 

 

 

Others

402,274

262,763

 

Treasury stock, at cost

(220,120)

(224,505)

 

      TOTAL S/HOLDERS` EQUITY

2,823,346

2,426,861

 

      TOTAL EQUITIES

4,442,507

3,979,093

CONSOLIDATED CASH FLOWS

 

 

Terms ending:

31/03/2014

31/03/2013

 

Cash Flows from Operating Activities

 

462,799

374,775

 

Cash Flows from Investment Activities

-390,318

-269,183

 

Cash Flows from Financing Activities

-154,976

-98,519

 

Cash, Bank Deposits at the Term End

 

641,694

707,330

ANALYTICAL RATIOS            Terms ending:

31/03/2014

31/03/2013

 

Net Worth (S/Holders' Equity)

2,823,346

2,426,861

 

Current Ratio (%)

227.12

234.39

 

Net Worth Ratio (%)

63.55

60.99

 

Recurring Profit Ratio (%)

10.24

8.27

 

Net Profit Ratio (%)

7.02

5.07

 

 

Return On Equity (%)

10.18

7.49

 

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.62.29

UK Pound

1

Rs.93.02

Euro

1

Rs.67.36

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

MNL

 

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.