MIRA INFORM REPORT

 

 

Report No. :

323075

Report Date :

20.05.2015

 

IDENTIFICATION DETAILS

 

Name :

MITSUBISHI HEAVY INDUSTRIES LTD

 

 

Registered Office :

2-16-5 Konan Minatoku Tokyo 106-8215

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2014 (Consolidated)

 

 

Date of Incorporation :

11.01.1950

 

 

Com. Reg. No.:

0104-01-050387 (Tokyo-Minatoku)

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Manufacturer of Comprehensive Heavy Machinery

 

Subject operates through following divisions:-

 

Shipbuilding & Offshore Structure: Ships, Industrial Carriers, Navigation Systems, Oil Storage Facilities, Patrol Boats, Offshore Production Facilities, Repairing & Conversion);

 

Power Systems: Combined Power Plants, Diesel Power Plants, Maritime Devices, LNG Power Plants, Thermal Power Generating Plants & Instrument Control Devices

 

Machinery & Steel Structure: Steel Bridges, Tunnel Ventilation Equipment, Energy-Related Facilities, Material Handling Equipment, Distribution Equipment, Flood Prevention & Irrigation Works, Underground Construction Equipment, Water Supply Systems, Cranes, Conveyors, Mechanical Parking Systems, Environmental Devices, Compressors & Mechanical Drive Turbines, Chemical Plants, Oil & Gas Production Plants, Testing & Measuring Equipment, Iron & Steel Machinery As Well As Seawater Desalination Plants

 

Aerospace: Defense Aircrafts, Aero Engines, Guided Weapon Systems, Civil Aircrafts & Aero Engines, Space Systems;

 

Mass & Medium-Lot Manufactured Machinery: Forklifts, Compressors, Small-Medium Sized Engines, Tractors, Industrial Robots, Paper & Printing Machinery, Construction Machinery, Special Vehicles, Turbo Chargers, Distribution Equipment & Refrigeration Systems

 

 

No of Employees :

80,583 (As of March 31, 2014) – Consolidated

 

 

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. Since the complete shutdown of Japan’s nuclear reactors after the earthquake and tsunami disaster in 2011, Japan's industrial sector has become 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 four 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. A sales tax increase caused the economy to contract during the 2nd and 3rd quarters of 2014. The economy has largely recovered in the three years since the disaster, but reconstruction in the Tohoku region has been uneven due to labor shortages. 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 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. The government will continue a longstanding debate on restructuring the economy and reining in Japan's huge government debt, which amounts to more than 240% 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 2015, although the government in 2014 decided to postpone the final phase of the increase until 2017 to give the economy time to recover from the 2014 increase. 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

 

MITSUBISHI HEAVY INDUSTRIES LTD

 

 

REGD NAME

 

Mitsubishi Jyukogyo KK

 

 

MAIN OFFICE

 

2-16-5 Konan Minatoku Tokyo 106-8215 JAPAN

Tel: 03-6716-3111     Fax: 03-6716-5800

 

*.. The is its Nagoya Factory

 

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

E-Mail address:            info@mhi.co.jp

 

 

ACTIVITIES

 

Manufacturer of Comprehensive Heavy Machinery

 

Subject operates through following divisions:-

 

Shipbuilding & Offshore Structure: Ships, Industrial Carriers, Navigation Systems, Oil Storage Facilities, Patrol Boats, Offshore Production Facilities, Repairing & Conversion);

 

Power Systems: Combined Power Plants, Diesel Power Plants, Maritime Devices, LNG Power Plants, Thermal Power Generating Plants & Instrument Control Devices

 

Machinery & Steel Structure: Steel Bridges, Tunnel Ventilation Equipment, Energy-Related Facilities, Material Handling Equipment, Distribution Equipment, Flood Prevention & Irrigation Works, Underground Construction Equipment, Water Supply Systems, Cranes, Conveyors, Mechanical Parking Systems, Environmental Devices, Compressors & Mechanical Drive Turbines, Chemical Plants, Oil & Gas Production Plants, Testing & Measuring Equipment, Iron & Steel Machinery As Well As Seawater Desalination Plants

 

Aerospace: Defense Aircrafts, Aero Engines, Guided Weapon Systems, Civil Aircrafts & Aero Engines, Space Systems;

 

Mass & Medium-Lot Manufactured Machinery: Forklifts, Compressors, Small-Medium Sized Engines, Tractors, Industrial Robots, Paper & Printing Machinery, Construction Machinery, Special Vehicles, Turbo Chargers, Distribution Equipment & Refrigeration Systems

 

BRANCHES

 

Osaka, Nagoya, Fukuoka, Sapporo, Hiroshima, other (Tot 31)

 

 

OVERSEAS

 

(Offices & Representatives) 9

Subsidiaries): Europe (19), North & South Americas (43), Asia (70),

Oceania (2), Africa (2)

 

 

FACTORIES

 

Nagasaki, Kobe, Shimonoseki, Yokohama, Hiroshima, other (Tot 26) Thailand (factory)

 

 

CHIEF EXEC

 

SHUNICHI MIYANAGA, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 A/SALES          Yen 3,349,598 M

PAYMENTSREGULAR   CAPITAL           Yen 265,608 M

TREND UP                    WORTH            Yen 1,774,223 M

STARTED         1950                 EMPLOYES      80,583 (As of March 31, 2014) – Consolidated

 

 

COMMENT    

 

COMPREHENSIVE HEAVY MACHINERY MFR. 

 

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

2,903,770

68,113

30,117

(%)

1,312,678

(Consolidated)

31/03/2012

2,820,932

86,182

24,540

-2.85

1,306,366

31/03/2013

2,817,893

149,028

97,330

-0.11

1,430,225

31/03/2014

3,349,598

183,159

160,428

18.87

1,774,223

31/03/2015

4,000,000

230,000

130,000

19.42

..

Unit: In Million Yen

Forecast (or estimated) figures for 31/03/2015 fiscal term

 

 

HIGHLIGHTS

 

This is the nation’s largest mfr of comprehensive heavy machinery, and core of Mitsubishi group.  Maintains overwhelmingly strong market position in shipbuilding, N-Power plants, aerospace, engines, and other heavy machineries.  Also involved in various operations, such as power plants, bridges, environmental systems, theme parks & air-conditioning with more than 700 kinds of products.  (For products, see OPERATION).  Fills majority of orders for arms from Defense Ministry and by far leads others in this sector.  Windmill production expanding to 2,600 megawatts over medium term (currently 1,200 megawatts).  The firm has won a turnkey order from Japan-Thailand joint venture Gulf JP Co to build a 1.6-gigawatt combined-cycle gas powered plant in Thailand.  The plant has two units that started production in June and December 2013, says the firm.  The company has invested Yen 15 billion in a local shipbuilder in Brazil to participate in the management and take a firm foothold there to acquire strong demand for drilling ships and the likes.  It is establishing a joint venture specialized in ocean windmills with Vestas, major wind power generation equipment maker in Europe, by spring 2014. 

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2014 fiscal term amounted to Yen 3,349,598 million, an 18.9% up from Yen 2,817,893 million in the previous term.  Mfg of aircraft parts expanded, driven by a weaker Yen and rise in plant operating rates.  Sales of compressors and chemical plants grew.  Prime-cost reduction made a progress.  The recurring profit was posted at Yen 183,159 million and the net profit at Yen 160,428 million, respectively, compared with Yen 149,028 million recurring profit and Yen 97,330 million net profit, respectively, a year ago.  Profitability expanded.

 

For the current term ending Mar 2015 the recurring profit is projected at Yen 230,000 million and the net profit at Yen 130,000 million, respectively, on a 19.4% rise in turnover, to Yen 4,000,000 million.  The weaker Yen will contribute throughout the term.  Business size of thermal power equipment will expand, due to the business integration with Hitachi Ltd.  .

 

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

 

 

REGISTRATION

 

Date Registered:           Jan 1950

Regd No.:                       0104-01-050387 (Tokyo-Minatoku)

Legal Status:       Limited Company (Kabushiki Kaisha)

Authorized:         6,000 million shares

Issued:                3,373,647,813 shares

Sum:                   Yen 265,608 million

           

Major shareholders (%): Master Bank of Japan T (4.2), Japan Trustee Services Bank, (3.9), Nomura T (BOTMU) (3.7), JP Morgan Chase Bank 380055 (2.8), Meiji Yasuda Life Ins (2.3), Tokio Marine & Nichido Fire Ins (1.4), Nomura T (MUTB) (1.3), Bank of New York Treaty Jasdec (1.3), SSBT OD05 Omnibus Acct Treaty CI. (1.1), Chase London SL Omnibus Acct (1.1); foreign owners (30.2)

           

No. of shareholders: 278,119

 

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

 

Managements: Hideaki Ohmiya, ch; Shunichi Miyanaga, pres; Atsushi Maekawa, v pres; Yoichi Kujirai, v pres; Hisakado Mizutani, s/mgn dir; Kazuaki Kimura, s/mgn dir; Tatsuhiko Nojima, s/mgn dir; Takashi Funato, s/mgn dir; Toshio Kodama, s/mgn dir; Masahiko Arihara, s/mgn dir; Yukio Kodama, s/mgn dir

           

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

 

Related companies: Mitsubishi-Hitachi Metals Mfg, MHI Environment Engineering,  Mitsubishi Heavy Ind Printing, MPSA, MCFA, other

 

 

OPERATION

 

Activities: Comprehensive heavy machinery mfr:

 

(Sales Breakdown by Divisions):

 

Shipbuilding & Offshore Structure (8%): ships, industrial carriers, navigation systems, oil storage facilities, patrol boats, offshore production facilities, repairing & conversion);

 

Power Systems (35%): combined power plants, diesel power plants, maritime devices, LNG power plants, thermal power generating plants & instrument control devices

 

Machinery & Steel Structure (17%): steel bridges, tunnel ventilation equipment, energy-related facilities, material handling equipment, distribution equipment, flood prevention & irrigation works, underground construction equipment, water supply systems, cranes, conveyors, mechanical parking systems, environmental devices, compressors & mechanical drive turbines, chemical plants, oil & gas production plants, testing & measuring equipment, iron & steel machinery as well as seawater desalination plants

 

Aerospace (20%): defense aircrafts, aero engines, guided weapon systems, civil aircrafts & aero engines, space systems;

 

Mass & Medium-lot Manufactured Machinery (15%): forklifts, compressors, small-medium sized engines, tractors, industrial robots, paper & printing machinery, construction machinery, special vehicles, turbo chargers, distribution equipment & refrigeration systems

 

Others (5%): machine tools, precision cutting tools, automotive components, other.

 

Overseas trading ratio (45%)

 

Clients: [Mfrs, electric powers, governments, wholesalers] Defense Ministry, Tokyo Electric Power, Kyushu Electric Power, Shikoku Electric Power, Kansai Electric Power, Japan Aerospace Exploration Agency, Mitsubishi Motors, Road & Transport Authority, Government of Dubai, airlines companies, other.

            No. of accounts: 3,000

            Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Mitsubishi Corp, Sumitomo Corp, Metal One, Mitsubishi   Electric, Kawasaki Heavy Ind, Taihei Dengyo Kaisha, Shin Maywa Ind, IHI Aerospace, Toshiba Corp, other.

 

Payment record: Regular

 

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

 

Bank References:

MUFG (H/O)

Mizuho Bank (H/O)

Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

　

　

Terms Ending:

31/03/2014

31/03/2013

INCOME STATEMENT

  Annual Sales

　

3,349,598

2,817,893

  Cost of Sales

2,695,898

2,297,072

      GROSS PROFIT

653,700

520,821

  Selling & Adm Costs

447,581

357,300

      OPERATING PROFIT

206,118

163,520

  Non-Operating P/L

-22,959

-14,492

      RECURRING PROFIT

183,159

149,028

　

      NET PROFIT

160,428

97,330

BALANCE SHEET

  Cash

　

381,056

328,395

  Receivables

1,188,928

931,469

  Inventory

1,150,900

1,009,835

  Securities, Marketable

29

2

  Other Current Assets

459,948

355,123

      TOTAL CURRENT ASSETS

3,180,861

2,624,824

  Property & Equipment

930,498

792,932

  Intangibles

171,100

2,926

  Investments, Other Fixed Assets

603,576

514,437

      TOTAL ASSETS

4,886,035

3,935,119

  Payables

801,445

663,451

  Short-Term Bank Loans

166,296

154,014

　

　

　

  Other Current Liabs

1,317,537

876,357

      TOTAL CURRENT LIABS

2,285,278

1,693,822

  Debentures

175,000

200,000

  Long-Term Bank Loans

359,946

477,053

  Reserve for Retirement Allw

189,937

51,904

  Other Debts

　

101,651

82,114

      TOTAL LIABILITIES

3,111,812

2,504,893

      MINORITY INTERESTS

Common stock

265,608

265,608

Additional paid-in capital

203,978

203,956

Retained earnings

1,031,371

901,397

Evaluation p/l on investments/securities

43,188

30,979

Others

235,463

33,679

Treasury stock, at cost

(5,385)

(5,394)

      TOTAL S/HOLDERS` EQUITY

1,774,223

1,430,225

　

      TOTAL EQUITIES

4,886,035

3,935,119

CONSOLIDATED CASH FLOWS

Terms ending:

31/03/2014

31/03/2013

Cash Flows from Operating Activities

　

296,216

288,375

Cash Flows from Investment Activities

-151,555

-76,737

Cash Flows from Financing Activities

-136,669

-154,215

　

Cash, Bank Deposits at the Term End

　

370,710

319,426

ANALYTICAL RATIOS            Terms ending:

31/03/2014

31/03/2013

Net Worth (S/Holders' Equity)

1,774,223

1,430,225

Current Ratio (%)

139.19

154.96

Net Worth Ratio (%)

36.31

36.35

Recurring Profit Ratio (%)

5.47

5.29

Net Profit Ratio (%)

4.79

3.45

Return On Equity (%)

9.04

6.81

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.63.69

UK Pound

1

Rs.99.73

Euro

1

Rs.71.90

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

SHG

 

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.