MIRA INFORM REPORT

 

 

Report No. :

340553

Report Date :

10.09.2015

 

 

IDENTIFICATION DETAILS

 

Name :

NIPPON STEEL & SUMIKIN BUSSAN CORPORATION

 

 

Registered Office :

Nittetsu Sumikin Bussan Bldg, 8-5-27 Akasaka Minatoku Tokyo 107-8527

 

 

Country :

Japan

 

 

Financials (as on) :

31.03.2015

 

 

Date of Incorporation :

August, 1977 (of the former Nippon Steel Trading Co)

 

 

Com. Reg. No.:

0100-01-094558 (Tokyo-Minatoku)

 

 

Legal Form :

Limited Company (Kabushiki Kaisha)

 

 

Line of Business :

Subject is import, export and wholesale of steel, raw fuels, industrial machinery & materials.

 

 

No. of Employees :

7,993

 

 

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 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

 

NIPPON STEEL & SUMIKIN BUSSAN CORPORATION

 

(Born by the merger of Nippon Steel Trading Co Ltd & Sumikin Bussan Corp in Oct/2013)

 

REGD NAME:               Nittetsu Sumikin Bussan KK

 

MAIN OFFICE:              Nittetsu Sumikin Bussan Bldg, 8-5-27 Akasaka Minatoku Tokyo 107-8527 JAPAN

                                    Tel: 03-5412-5001     Fax: 03-5412-5101     -

 

URL:                             http://www.nssbussmc.com

E-Mail address:            (thru the URL)

 

 

ACTIVITIES

 

Import, export, wholesale of steel, raw fuels, industrial machinery & materials

 

 

BRANCHES

 

31 domestic (nationwide)

 

 

OVERSEAS

 

36 cities in 17 countries

 

 

CHIEF EXEC

 

KENJI HIWATARI, PRES

 

Yen Amount:     In million Yen, unless otherwise stated

 

 

SUMMARY

 

FINANCES        FAIR                 A/SALES                      Yen 5,610,030 M

PAYMENTS      REGULAR         CAPITAL                       Yen 12,335 M

TREND             UP                    WORTH                        Yen 3,547,059 M

STARTED         1977                 EMPLOYES                  7,993

                       

                       

COMMENT

 

TRADING FIRM SPECIALISING IN STEEL 

 

FINANCIAL SITUATION COSIDERED FAIR AND GOOD FOR ORDINARY BUSINESS ENGAGEMENTS.

           

Unit: In Million Yen.  Figures until the 31/03/2013 fiscal term are those of the Nippon

Steel Trading Co Ltd before the merger

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

 

 

HIGHLIGHTS

 

The subject company was born in Oct 2013 by the merger of Nippon Steel Trading Co Ltd and Sumikin Bussan Corporation in order to integrate steel operations. This is a steel product trading house having strong ties with Nippon Steel & Sumitomo Metal. Downsizing businesses, including foodstuffs, construction, etc and management resources concentrating on steel-related areas. Pioneer in field of e-commerce.  .

 

 

FINANCIAL INFORMATION

 

The sales volume for Mar/2015 amounted to Yen 5,610,030 million, a 1.7% up from Yen 5,516,180 million in the previous term.  The recurring profit was posted at Yen 451,747 million and the net profit at Yen 214,293 million, respectively, compared with Yen 361,097 million recurring profit and Yen 242,753 million net profit, respectively, a year ago.. 

 

For the current term ending Mar 2016 the recurring profit is projected at Yen 460,000 million and the net profit at Yen 215,000 million, respectively, on 1.6% rise in turnover, to Yen 5,700,000 million.  Overseas projects in industrial machinery and end of inventory adjustment in textiles will make a contribution.

 

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

 

 

REGISTRATION

           

Date Registered:           Aug 1977 (of the former Nippon Steel Trading Co)

Regd No.:                                 0100-01-094558 (Tokyo-Minatoku)

Legal Status:                Limited Company (Kabushiki Kaisha)

Authorized:                  500 million shares

Issued:                         309,578,001 shares

Sum:                            Yen 12,335 million

 

Major shareholders (%): Nippon Steel & Sumitomo Metal (35.9), Mitsui & Co (10.9), Japan Trustee Services T (3.7), Master Trust Bank of Japan T (2.7), Kyoei Steel (1.2), Employees’ S/Holding Assn (1.2), SSBT OD05 Omnibus Acct Treaty (0.7), Chuo Denki Kogyo (0.6), JTSB (Chuo Denki Kogyo) (0.6), Air Water (0.6); foreign owners (12.1)

 

No. of shareholders: 10,086

 

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

 

Managements: Kenji Hiwatari, pres; v pres; Akio Tamagawa, v pres; Ichiro Miyasaka, adviser; Etsuo Shimotori, dir; Keiji Kurita, dir; Masaharu Takeda, dir; Hiroshi Shono, dir; Akio Uemura, dir; Yuichi Nomura, dir; Eiichi Nakamura, dir

 

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

 

Related companies: NSL Coil Center, Igeta Sunrise Pipe, Sumikin Bussan Kenzai, etc.

 

 

OPERATION

           

Activities: Imports, exports and wholesales steel products (coking coal, non-ferrous metal) (80%), textiles (8%), foods (7%), industrial machinery & infrastructure (4%)

Overseas Sales Ratio (26%)

           

Clients: [firs, wholesalers] Nittetsu Group firms, other

No. of accounts: 500

Domestic areas of activities: Nationwide

 

Suppliers: [Mfrs, wholesalers] Nittetsu Sumikin Stainless, Nittetsu Sumikin Kenzai (building materials), other

 

Payment record: Regular

 

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

 

Bank References:

            SMBC (H/O)

            MUFG (Tokyo)

            Relations: Satisfactory

 

 

FINANCES

(In Million Yen)

 

FINANCES: (Consolidated in million yen)

　

　

Terms Ending:

31/03/2015

31/03/2014

INCOME STATEMENT

  Annual Sales

　

5,610,030

5,516,180

  Cost of Sales

4,801,781

4,760,308

      GROSS PROFIT

808,248

755,872

  Selling & Adm Costs

458,738

457,482

      OPERATING PROFIT

349,510

298,390

  Non-Operating P/L

102,237

62,707

      RECURRING PROFIT

451,747

361,097

　

      NET PROFIT

214,293

212,753

BALANCE SHEET

  Cash

　

113,822

105,303

  Receivables

615,429

589,802

  Inventory

1,254,203

1,225,014

  Securities, Marketable

2,025

8,025

  Other Current Assets

348,334

345,227

      TOTAL CURRENT ASSETS

2,333,813

2,273,371

  Property & Equipment

2,597,872

2,612,280

  Intangibles

98,862

94,079

  Investments, Other Fixed Assets

2,127,382

2,102,658

      TOTAL ASSETS

7,157,929

7,082,388

  Payables

674,634

661,267

  Short-Term Bank Loans

363,654

435,357

　

　

　

  Other Current Liabs

651,509

714,513

      TOTAL CURRENT LIABS

1,689,797

1,811,137

  Debentures

385,676

425,668

  Long-Term Bank Loans

1,169,840

1,313,248

  Reserve for Retirement Allw

161,332

157,373

  Other Debts

　

204,225

136,867

      TOTAL LIABILITIES

3,610,870

3,844,293

      MINORITY INTERESTS

  Capital, Paid-Up

12,335

12,335

  Surplus

3,534,724

3,225,660

      SHAREHOLDERS' EQUITY

3,547,059

3,237,995

　

      TOTAL EQUITIES

7,157,929

7,082,338

CONSOLIDATED CASH FLOWS

Terms ending:

31/03/2015

31/03/2014

Cash Flows from Operating Activities

　

710,998

574,767

Cash Flows from Investment Activities

-263,667

-196,856

Cash Flows from Financing Activities

-451,863

-367,115

　

Cash, Bank Deposits at the Term End

　

112,994

105,464

ANALYTICAL RATIOS            Terms ending:

31/03/2015

31/03/2014

Net Worth (S/Holders' Equity)

3,547,059

3,237,995

Current Ratio (%)

138.11

125.52

Net Worth Ratio (%)

49.55

45.72

Recurring Profit Ratio (%)

8.05

6.55

Net Profit Ratio (%)

3.82

3.86

Return On Equity (%)

6.04

6.57

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.66.29

UK Pound

1

Rs.101.89

Euro

1

Rs.73.98

 

 

 

 

 

INFORMATION DETAILS

 

Analysis Done by :

TRI

 

 

Report Prepared by :

ASH

 

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%)

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