MIRA INFORM REPORT

 

 

Report No. :

344034

Report Date :

08.10.2015

 

IDENTIFICATION DETAILS

 

Name :

SOJITZ CORPORATION

 

 

Registered Office :

2-1-1 Uchisaiwaicho Chiyodaku Tokyo 100-8691

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2015

 

 

Date of Incorporation :

December 1982

 

 

Com. Reg. No.:

(Tokyo-Minatoku) 049977

 

 

Legal Form :

Limited Company

 

 

Line of Business :

Subject is Import, export, wholesale of machinery, energy & metals, chemicals, other

 

 

No. of Employee :

15,936

 

 

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

 

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

 

SOJITZ CORPORATION

 

 

REGD NAME

 

Sojitz KK

 

 

MAIN OFFICE

 

2-1-1 Uchisaiwaicho Chiyodaku Tokyo 100-8691 JAPAN

Tel: 03-6871-5000     Fax: 03-6871-2430

 

 

URL

 

http://www.sojitz.com/

E-Mail address: info@sojitz.com

 

 

ACTIVITIES

 

Import, export, wholesale of machinery, energy & metals, chemicals, other

 

 

BRANCHES

 

7 domestic, 87 overseas

(Subsidiaries/affiliates): 117 domestic, 322 overseas

 

 

CHIEF EXECS

 

YOJI SATO, PRES

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 A/SALES          Yen 4,105,295 M

PAYMENTSREGULAR   CAPITAL           Yen 160,339 M

TREND STEADY           WORTH            Yen 590656 M

STARTED         2003                 EMPLOYES      15,936

 

                       

COMMENT

 

GENERAL TRADING HOUSE. 

FINANCIAL SITUATION CONSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                                     Unit: In Million Yen

Forecast figures for the 31/03/2016 fiscal term.

 

 

HIGHLIGHTS

 

The subject company was established in Apr 2003 by forming a joint holding company, named Nissho Iwai-Nichimen Holdings Company, by the then Nissho Iwai Co and Nichimen Co, and subsequently in Apr 2004 the two merged into Sojitz Corp as captioned.  The holding company, at the same time, renamed Sojitz Holdings Corporation.  The merger was formed in order to restructure the two firms through supports from financial institutions including the then UFJ Bank (now MUFG), the main bank for the two firms.  On 01/Oct/2005, in order to further streamline the Group’s management framework, Sojitz Holdings merged with its principal operating arm and wholly owned subsidiary, Sojitz Corporation.  The company’s name was then changed to Sojitz Corporation.  This is a general trading house succeeding the business rights & operations of the said two firms, excluding liquidation or separation of unprofitable divisions & operations.  This is the sixth-ranked general trading house.  Major handling items are machinery, energy & resources, which former Nissho Iwai Corp was the stronger, and textiles, etc, which the former Nichimen Corp was stronger.  Highly competitive in fields of aircraft, lumber and urban development.  The company is intensifying Brazil’s cereal crop cargo pickup/export business for Asia.  It is investing Yen 16 billion in local major firm to expand commercial distribution channels. 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2014 fiscal term amounted to Yen 4,105,295 million, a 1.5% up from Yen 4,046,577 million in the previous term.   The recurring profit was posted at Yen 52,584 million and the net profit at Yen 37,650 million respectively, compared with Yen 44,033 million recurring profit and Yen 32,083 million net profit, respectively, a year ago

 

For the current term ending Mar 2016 the recurring profit is projected at Yen 58,500 million and the net profit at Yen 40,000 million, respectively, on a 7.2% rise in turnover, to Yen 4,400,000 million. 

 

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

 

 

REGISTRATION

           

Date Registered:                       Dec 1982

Regd No.:                    (Tokyo-Minatoku) 049977

Legal Status:                             Limited Company (Kabushiki Kaisha)

Authorized:                  2,500 million shares

Issued:                         1,251,499,501 shares

Sum:                            Yen 160,339 million

           

Major shareholders (%): MSIP Client Securities (4.0), Japan Trustee Services T (3.8), Master Trust Bank of Japan T (3.0), BBH-Boston GMO Int’l Intrinsic V (1.5), Japan Trustee Services T) (1.4),  Chase Manhattan GTS Escrow (1.3), State Street Bank & Trust 505225 (1.3), State Street Bank West Treaty (1.1), Japan Trustee Services T6 (1.1), Japan Trusty Services T5 (1.0), Japan Trustee Services T3 (1.0), Japan Trustee Services T2 (1.0), Japan Trustee Services T1 (1.0); foreign owners (30,8)

 

No. of shareholders: 163,526

 

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

 

Managements: Yutaka Kase, ch; Takashi Hara, v ch; Yoji Sato, pres; Yoshio Migi, v pres; Shigeki Dantani, dir; Yoko Kurita, dir; Yukio Kitagawa, dir

 

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

 

Related companies: Sojitz Marine & Engineering, Sojitz Building Materials Corp, other (Tot 117 domestic &322 overseas)

 

 

OPERATION

 

Activities: A general trading house:

(Sales breakdown by Divisions):

 

Machinery Division (27%): Automotive Unit, Environment & Infrastructure Unit, IT Business Unit, Marine & Aerospace Unit;

Energy & Metals Division (19%): Energy & Nuclear Unit, Coal & Non-ferrous Metals Unit, Ferrous Metals & Steel Products Unit;

Chemicals & Functional Materials Division (16%): Chemicals Unit, Functional Materials Unit;

Lifestyle Business Division (36%): Foods Resources Unit, General Commodities & Textile Unit, Forest Products & Real Estate Development Unit;

Others (2%)

Overseas trading (48%)

 

Clients: [Mfrs, wholesalers] Kobe Steel, NM Life, First Retailing, Uto Kosan, Zao Severstal, Varig S.A., Auto-Isuzu PT Indofood Sukses Makmur TBK, MMC Automotriz SA, other

No. of accounts: 2,000

Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] Hitachi Zosen, Hitachi Ltd, Toyo Rubber, Yamazaki  Nabisco, Sun Building Materials Corp, Sumitomo Metal Mining, Fuji Electric Systems, Sojitz Asia, other.

 

Payment record: Regular

 

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

 

Bank References:

MUFG (Tokyo)

Mizuho Bank (H/O)

Relations: Satisfactory

 

 

FINANCIALS

 

(In Million Yen)

FINANCES: (Consolidated in million yen)

　

　

　

Terms Ending:

31/03/20１５

31/03/2014

INCOME STATEMENT

　

　

  Annual Sales

　

4,105,291

4,046,577

　

  Cost of Sales

2,295,590

2,441,695

　

      GROSS PROFIT

1,809,701

1,604,882

　

  Selling & Adm Costs

14,398

22,898

　

      OPERATING PROFIT

1,795,303

1,581,984

　

  Non-Operating P/L

1,742,719

1,537,951

　

      RECURRING PROFIT

52,584

44,033

　

      NET PROFIT

37,650

32,083

BALANCE SHEET

　

　

  Cash

　

403,748

420,658

　

  Receivables

559,291

524,826

　

  Inventory

270,274

301,979

　

  Securities, Marketable

　

　

　

  Other Current Assets

　

　

　

      TOTAL CURRENT ASSETS

1,323,497

1,321,824

　

  Property & Equipment

217,912

213,934

　

  Intangibles

53,882

60,958

　

  Investments, Other Fixed Assets

　

　

　

      TOTAL ASSETS

2,297,358

2,220,236

　

  Payables

490,365

514,585

　

  Short-Term Bank Loans

208,360

227,216

　

　

　

　

　

  Other Current Liabs

　

　

　

      TOTAL CURRENT LIABS

780,538

811,850

　

  Debentures

830,409

838,060

　

  Long-Term Bank Loans

9,545

10,463

　

  Reserve for Retirement Allw

17,943

16,917

　

  Other Debts

　

　

　

　

      TOTAL LIABILITIES

1,706,702

1,727,277

　

      MINORITY INTERESTS

　

　

Common stock

160,339

160,339

　

Additional paid-in capital

146,515

146,515

　

Retained earnings

　

　

　

Evaluation p/l on investments/securities

194,557

119,617

　

Others

　

　

　

Treasury stock, at cost

(159)

(157)

　

      TOTAL S/HOLDERS` EQUITY

590,656

492,959

　

      TOTAL EQUITIES

2,297,358

2,220,236

CONSOLIDATED CASH FLOWS

　

　

Terms ending:

31/03/2015

31/03/2014

　

Cash Flows from Operating Activities

　

39,109

46,997

　

Cash Flows from Investment Activities

-13,792

-24,459

　

Cash Flows from Financing Activities

-42,600

-30,931

　

Cash, Bank Deposits at the Term End

　

403,748

420,658

ANALYTICAL RATIOS            Terms ending:

31/03/20１５

31/03/2014

　

Net Worth (S/Holders' Equity)

590,656

492,959

　

Current Ratio (%)

169.56

162.82

　

Net Worth Ratio (%)

25.71

22.20

　

Recurring Profit Ratio (%)

1.28

1.09

　

Net Profit Ratio (%)

0.92

0.79

　

　

Return On Equity (%)

6.37

6.51

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.65.26

UK Pound

1

Rs.99.53

Euro

1

Rs.73.47

 

INFORMATION DETAILS

 

Analysis Done by :

KAS

 

 

Report Prepared by :

ANK

 

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.