MIRA INFORM REPORT

 

 

Report No. :

345440

Report Date :

14.10.2015

 

IDENTIFICATION DETAILS

 

Name :

ZEON CORPORATION

 

 

Registered Office :

1-6-2 Marunouchi Chiyodaku Tokyo 100-0005

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2015

 

 

Date of Incorporation :

April 1950

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Manufacturer of synthetic rubber, industrial chemicals.

 

 

No. of Employee :

3,216

 

 

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 – 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 inefficientINVESTMENT 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 and address

 

ZEON CORPORATION

 

REGD NAME:   Nippon Zeon KK

MAIN OFFICE:  1-6-2 Marunouchi Chiyodaku Tokyo 100-0005 JAPAN

                                    Tel: 03-3216-1772     Fax: 03-3216-0501     -

 

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

E-Mail address: (thru the URL)

 

 

ACTIVITIES

 

Mfg of synthetic rubber, industrial chemicals, other

 

 

BRANCHES

 

Osaka, Nagoya

 

 

OVERSEAS

 

Europe (6), Americas (5), Asia & Oceanic (12)

 

 

FACTORIES

 

Takaoka, Kawasaki, Tokuyama, Mizushima (Tot 4); Singapore, Thailand, other

 

 

CHIEF EXEC

 

KIMIAKI TANAKA, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                             A/SALES          Yen 307,524 M

PAYMENTSREGULAR               CAPITAL           Yen 24,211 M

TREND UP                                WORTH            Yen 215,631 M

STARTED         1950                             EMPLOYES      3,216

 

 

COMMENT

 

MFR OF SYNTHETIC RUBBER, OTHER

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

 

 

Unit: In Million Yen

Forecast figures for the 31/10/2016 fiscal term.

 

 

HIGHLIGHTS

 

This is the leading mfr of synthetic rubber that was originally a JV with BF Goodrich Chemical of the US to produce vinyl chloride resin.  The company started Japan’s first mass-production of synthetic rubber at the plant in Kawasaki City, Kanagawa-Pref, and is now ranked second in that sector domestically after JSR.  The company is developing transparent resins as liquid crystal materials using in-house technology.

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2015 fiscal term amounted to Yen 307,524 million, a 3.7% up from Yen 296,427 million in the previous term.  The recurring profit was posted at Yen 31,096 million and the net profit at Yen 19,080 million, respectively, compared with Yen 32,561 million recurring profit and Yen 19,650 million net profit, respectively, a year ago.

 

(Apr/Jun/2015 results):  Sales Yen 75,953 million (up 1.5%), operating profit Yen 7,849 million (up 26.5%), recurring profit Yen 8,532 million (up 40.5%), net profit Yen 5,607 million (up 43.2%).  (% as compared with the corresponding period a year ago).

 

For the current term ending Mar 2016 the recurring profit is projected at Yen 32,000 million and the net profit at Yen 23,000 million, respectively, on a 4.1% rise in turnover, to Yen 320,000 million.  Orders for optical films for LCDs will remain brisk.  Sales of rubber for fuel-efficient tires will grow further, thanks to full-scale operation at its plant in Singapore.  Net profit will hit a new high.

 

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

 

 

REGISTRATION

           

Date Registered:　                   Apr 1950

Legal Status:                Limited Company (Kabushiki Kaisha

Authorized:                              800 million shares

Issued:                         242,075,556 shares

Sum:                            Yen 24,211 million

 

Major shareholders (%): Yokohama Rubber (9.3), Company’s Treasury Stock (6.3), Japan Trustee Services T (4.6), Mizuho Bank (4.6), Northern Trust (AVFC) Re 15PCT T (3.6), Master Trust Bank of Japan T (3.2), Asahi Life Ins (3.1), Zenkyoren (3.0), Asahi Kasei Chemicals (2.6), Japan Trustee Services T9 (2.1); foreign owners (19.2)

 

No. of shareholders: 7,982

 

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

 

Managements: Naozumi Furukawa, ch; Kimiaki Tanaka, pres; Masayoshi Oshima, s/mgn dir; Hiroshi Takegami, mgn dir; Yoshiyuki Mitsuhira, mgn dir; Hiroyuki Hirakawa, mgn dir; Toru Nishijima, mgn dir; Kei Itoh, dir; Takeo Furuya, dir; Haruo Ito, dir; Takao Kitabata, dir; Tadanobu Nagumo, dir

 

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

 

Related companies: Zeon Kasei, Zeon Chemicals, Tokyo Zairyo, other.

 

 

OPERATION

           

Activities: Manufactures industrial chemicals:

 

Elastomer Materials (61%): synthetic rubber, synthetic lattice, chemicals (C5 petroleum resins, thermoplastic elastomers, etc);

Functional Materials (23%): specialty chemicals (synthetic aroma chemicals, industrial chemicals, etc), information materials (elastromics materials, polymerized toners, etc), specialty plastics, optical materials, medical products, other;

Others (16%): RIM products, paints, butadiene extraction technology, etc

Overseas Trading Ratio (51%)

           

Clients: [Mfrs, wholesalers] Yokohama Rubber Ind, Tokyo Zairyo, Sumitomo Rubber Ind,             JEOL Ltd, Konica-Minolta Techno Products, Mitsubishi Chemical, Idemitsu Kosan, Oka- yama Butadiene, other

No. of accounts: 800

Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] Idemitsu Kosan, Mitsubishi Chemical, Showa Denko, Asahi Kasei Chemicals, Mitsui & Co, Okayama Butadiene, Tosoh Corp, Itochu Corp, Kao Corp, Tonen Chemical, other

 

Payment record: Regular

 

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

 

Bank References:

Norin Chuo Bank (H/O)

Mizuho Bank (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

　

307,524

296,427

　

  Cost of Sales

224,887

213,307

　

      GROSS PROFIT

82,636

83,120

　

  Selling & Adm Costs

54,391

53,219

　

      OPERATING PROFIT

28,245

29,901

　

  Non-Operating P/L

2,853

2,660

　

      RECURRING PROFIT

31,098

32,561

　

      NET PROFIT

19,080

19,650

BALANCE SHEET

　

　

  Cash

　

4,151

9,105

　

  Receivables

70,970

70,602

　

  Inventory

61,235

60,959

　

  Securities, Marketable

　

　

　

  Other Current Assets

40,253

37,730

　

      TOTAL CURRENT ASSETS

176,609

178,396

　

  Property & Equipment

134,227

122,721

　

  Intangibles

5,262

5,943

　

  Investments, Other Fixed Assets

83,414

63,812

　

      TOTAL ASSETS

399,512

370,872

　

  Payables

60,466

64,769

　

  Short-Term Bank Loans

18,220

30,302

　

　

　

　

　

  Other Current Liabs

40,488

38,597

　

      TOTAL CURRENT LIABS

119,174

133,668

　

  Debentures

10,000

10,000

　

  Long-Term Bank Loans

20,669

20,263

　

  Reserve for Retirement Allw

14,209

12,368

　

  Other Debts

　

19,829

13,158

　

      TOTAL LIABILITIES

183,881

189,457

　

      MINORITY INTERESTS

　

　

Common stock

24,211

24,211

　

Additional paid-in capital

18,514

18,514

　

Retained earnings

148,285

132,476

　

Evaluation p/l on investments/securities

28,350

15,081

　

Others

9,008

3,866

　

Treasury stock, at cost

(12,737)

(12,734)

　

      TOTAL S/HOLDERS` EQUITY

215,631

181,414

　

      TOTAL EQUITIES

399,512

370,872

CONSOLIDATED CASH FLOWS

　

　

Terms ending:

31/03/2015

31/03/2014

　

Cash Flows from Operating Activities

　

34,006

36,396

　

Cash Flows from Investment Activities

-26,767

-31,513

　

Cash Flows from Financing Activities

-12,019

-10,105

　

Cash, Bank Deposits at the Term End

　

3,491

8,117

ANALYTICAL RATIOS            Terms ending:

31/03/2015

31/03/2014

　

Net Worth (S/Holders' Equity)

215,631

181,414

　

Current Ratio (%)

148.19

133.46

　

Net Worth Ratio (%)

53.97

48.92

　

Recurring Profit Ratio (%)

10.11

10.98

　

Net Profit Ratio (%)

6.20

6.63

　

　

Return On Equity (%)

8.85

10.83

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.65.02

UK Pound

1

Rs.99.89

Euro

1

Rs.73.92

 

 

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.