MIRA INFORM REPORT

 

 

Report No. :

347460

Report Date :

27.10.2015

 

IDENTIFICATION DETAILS

 

Name :

SODICK CO LTD

 

 

Registered Office :

3-12-1 Nakamachidai Tsuzukiku Yokohama 224-8522

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2015

 

 

Date of Incorporation :

August, 1976

 

 

Com. Reg. No.:

0200-01-020736 (Yokohama-Tsuzukiku)

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Manufacturer of NC Electro Dischargers.

 

 

No. of Employees :

3,196

 

 

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 and address

 

SODICK CO LTD

 

REGD NAME:               Sodick KK

 

MAIN OFFICE:              3-12-1 Nakamachidai Tsuzukiku Yokohama 224-8522 JAPAN

                                                Tel: 045-942-3111     Fax: 045-943-5835

 

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

E-Mail address:                        (thru the URL)

 

 

ACTIVITIES

 

Mfg of NC electro dischargers   

 

 

BRANCHES

 

Sendai, Saitama, Nagoya, Osaka, Kyoto, Osaka, other (Tot 18)

 

 

OVERSEAS   

 

China (3), Singapore, Korea, India (as given), Vietnam, UK, Germany, USA, Hong Kong (--subsidiaries)

 

 

FACTORIES

 

Fukui, Ishikawa, Kaga; China (4), Thailand

 

 

CHIEF EXEC

 

YUJI KANEKO, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY    

 

FINANCES        FAIR                 A/SALES                      Yen 63,090 M

PAYMENTSREGULAR   CAPITAL                       Yen 20,775 M

TREND UP                    WORTH                        Yen 49,453 M

STARTED         1976                 EMPLOYES                  3,196

 

 

COMMENT

           

MFR OF NC MACHINE TOOLS. 

 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

                       

Unit: In Million Yen

Forecast (or estimated) figures for 30/03/2016 fiscal term

 

 

HIGHLIGHTS

 

The subject company is pioneer & top-ranked mfr of NC numerically controlled) electric discharge machines.  Holds the top share at approximately 40% in Japan and ranks 2nd worldwide. Maintains strong market share in linear motor-driven type lector dischargers. Has mfg bases in China (4) and Thailand. The overseas sales ratio is high. Transferred the function at Yokohama office to the headquarter plant office in Fukui-Pref, except for the financial section. The firm intends to shift to its production to overseas, to reduce exchange risks. It will market linear motors manufactured in-house for internal use to outside firms. It made Sodick Plustech its wholly owned subsidiary through TOB. Advanced into LED lighting and food machinery .with the objective of stabilizing earnings. Fostering noodle-making machines. 

           

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2015 fiscal term amounted to Yen 63,090 million, a 10.9% up from Yen 56,899 million in the previous term.  The recurring profit was posted at Yen 5,647 million and the net profit at Yen 3,550 million, respectively, compared with Yen 3,886 million recurring profit and Yen 4,194 million net profit, respectively, a year ago. 

 

(Apr/Jun/2015 results): Sales Yen 14,310 million (up 18.3%), operating profit Yen 1,203 million (up 127.0%), recurring profit Yen 1,347 million (up 502.1%), net profit Yen 1,497 million (up 790.0%).  (% as compared with the corresponding period a year ago). 

           

For the current term ending Mar 2016 the recurring profit is projected at Yen 4,700 million and the net profit at Yen 3,600 million, respectively, on a 9.4% rise in turnover, to Yen 69,000 million. 

 

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

 

 

REGISTRATION

           

Date Registered:　          Aug 1976

Regd No.:                                             0200-01-020736 (Yokohama-Tsuzukiku)

Legal Status:                Limited Company (Kabushiki Kaisha)

Authorized:                  150 million shares

Issued:                         53,432,510 shares

Sum:                            Yen 20,775 million

 

Major shareholders (%): Company’s Treasury Stock (5.8), Japan Trustee Service T (2.3), Toshihiko Furukawa (2.2), T F Ltd (2.1), Master Trust Bank of Japan T (2.1), Japan Securities Finance (2.0), Company’s Kyoeikai Assn (1.8), SBI Securities (1.6), SMBC (1.5), Masaaki Suzuki (1.3); foreign owners (9.1)

 

No. of shareholders: 20,560

 

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

 

Managements: Toshihiko Furukawa, ch; Yuji Kaneko, pres; Kenichi Furukawa, v pres; Keisuke Takagi, s/mgn dir; Takashi Matsui, s/mgn dir; Misao Fujikawa, s/mgn dir; Sadao Sano, s/mgn dir; Ken’ichi Osako, mgn dir; Hirofumi Maejima, mgn dir; Hideki Tsukamoto, mgn dir; Kenichi Tsugami, dir; Toshiaki Kurihara, dir

 

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

 

Related companies: Sodick Plastic, Sodick FT, other

 

 

OPERATION

           

Activities: Manufactures NC machine tools (74%), industrial machinery (13%), food machinery (4%), others (8%)

 

Overseas Sales Ratio (64%)

 

(Mfg items): CNC die-sinker EDM, CNC wire EDM, CNC high-speed small hole drilling EDM, customized EDM & optional equipment (pallet changers & robots), CNC & power supply devices, precision EDM tooling, high speed precision milling center, nano-level precision machines, computer integrated mfg, high-precision injection molding machines, engineering ceramics, linear motors for machine tool & industrial production machines, electrochemical machines, EDM wires, precision tool and precise molding goods, electronic components, software, food machines, other.

           

Clients: [Mfrs, wholesalers] Yuasa Trading, Sodick Europe, Kanematsu KGK, Sodick Singapore, Sodick Inc,

Yamazen Corp, Sodick Taiwan, Sodick Thailand, other

No. of accounts: 1,000

Domestic areas of activities: Nationwide

Suppliers: [Mfrs, wholesalers] Sodick Thailand, Sodick Engineering, THK, Sodick EMG, Sodick FT, Yasukawa  Mechatrec, other.

 

Payment record: Regular

 

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

 

Bank References:

            Bank of Yokohama (Shin-Yokohama)

            Mizuho Bank (Yokohama)

            Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

　

　

　

Terms Ending:

31/03/2015

31/03/2014

INCOME STATEMENT

　

　

  Annual Sales

　

63,090

56,899

　

  Cost of Sales

42,214

40,233

　

      GROSS PROFIT

20,876

16,666

　

  Selling & Adm Costs

15,985

14,015

　

      OPERATING PROFIT

4,891

2,651

　

  Non-Operating P/L

756

1,235

　

      RECURRING PROFIT

5,647

3,886

　

      NET PROFIT

3,550

4,194

BALANCE SHEET

　

　

  Cash

　

27,767

24,049

　

  Receivables

15,092

14,968

　

  Inventory

24,805

21,962

　

  Securities, Marketable

　

　

　

  Other Current Assets

3,698

3,578

　

      TOTAL CURRENT ASSETS

71,362

64,557

　

  Property & Equipment

24,828

24,450

　

  Intangibles

3,707

4,346

　

  Investments, Other Fixed Assets

4,270

5,423

　

      TOTAL ASSETS

104,167

98,776

　

  Payables

4,714

8,530

　

  Short-Term Bank Loans

4,700

5,181

　

　

　

　

　

  Other Current Liabs

25,123

16,068

　

      TOTAL CURRENT LIABS

34,537

29,779

　

  Debentures

　

16

　

  Long-Term Bank Loans

18,779

24,656

　

  Reserve for Retirement Allw

565

1,003

　

  Other Debts

　

832

870

　

      TOTAL LIABILITIES

54,713

56,324

　

      MINORITY INTERESTS

　

　

Common stock

20,775

20,775

　

Additional paid-in capital

5,879

5,879

　

Retained earnings

16,503

13,714

　

Evaluation p/l on investments/securities

1,058

658

　

Others

6,934

3,120

　

Treasury stock, at cost

(1,696)

(1,695)

　

      TOTAL S/HOLDERS` EQUITY

49,453

42,451

　

      TOTAL EQUITIES

104,167

98,776

CONSOLIDATED CASH FLOWS

　

　

Terms ending:

31/03/2015

31/03/2014

　

Cash Flows from Operating Activities

　

8,298

5,577

　

Cash Flows from Investment Activities

-144

-4,181

　

Cash Flows from Financing Activities

-5,243

-3,696

　

Cash, Bank Deposits at the Term End

　

27,396

23,647

ANALYTICAL RATIOS            Terms ending:

31/03/2015

31/03/2014

　

Net Worth (S/Holders' Equity)

49,453

42,451

　

Current Ratio (%)

206.62

216.79

　

Net Worth Ratio (%)

47.47

42.98

　

Recurring Profit Ratio (%)

8.95

6.83

　

Net Profit Ratio (%)

5.63

7.37

　

　

Return On Equity (%)

7.18

9.88

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.64.96

UK Pound

1

Rs.99.55

Euro

1

Rs.71.62

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

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%)

 

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.