MIRA INFORM REPORT

 

 

Report No. :

342915

Report Date :

29.09.2015

 

IDENTIFICATION DETAILS

 

Name :

CHANGHONG (HONGKONG) TRADING LTD.

 

 

Registered Office :

Room 1412, 14/F., West Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan

 

 

Country :

Hongkong

 

 

Date of Incorporation :

24.05.2005

 

 

Com. Reg. No.:

35656159

 

 

Legal Form :

Private Limited Company.

 

 

Line of Business :

Importer and Exporter of Air-Conditioners, Electronic Products, Other Electric Appliances.

 

 

No. of Employees :

13. (Including Associates)

 

 

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 :

Satisfactory

 

 

Payment Behaviour :

No Complaints

 

 

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)

Hongkong

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

HONGKONG - ECONOMIC OVERVIEW

 

Hong Kong has a free market economy, highly dependent on international trade and finance - the value of goods and services trade, including the sizable share of re-exports, is about four times GDP. Hong Kong has no tariffs on imported goods, and it levies excise duties on only four commodities, whether imported or produced locally: hard alcohol, tobacco, hydrocarbon oil, and methyl alcohol. There are no quotas or dumping laws. Hong Kong's open economy left it exposed to the global economic slowdown that began in 2008. Although increasing integration with China, through trade, tourism, and financial links, helped it to make an initial recovery more quickly than many observers anticipated, its continued reliance on foreign trade and investment leaves it vulnerable to renewed global financial market volatility or a slowdown in the global economy. The Hong Kong government is promoting the Special Administrative Region (SAR) as the site for Chinese renminbi (RMB) internationalization. Hong Kong residents are allowed to establish RMB-denominated savings accounts; RMB-denominated corporate and Chinese government bonds have been issued in Hong Kong; and RMB trade settlement is allowed. The territory far exceeded the RMB conversion quota set by Beijing for trade settlements in 2010 due to the growth of earnings from exports to the mainland. RMB deposits grew to roughly 12.5% of total system deposits in Hong Kong by the end of 2014. The government is pursuing efforts to introduce additional use of RMB in Hong Kong financial markets and is seeking to expand the RMB quota. The mainland has long been Hong Kong's largest trading partner, accounting for about half of Hong Kong's total trade by value. Hong Kong's natural resources are limited, and food and raw materials must be imported. As a result of China's easing of travel restrictions, the number of mainland tourists to the territory has surged from 4.5 million in 2001 to 47.3 million in 2014, outnumbering visitors from all other countries combined. Hong Kong has also established itself as the premier stock market for Chinese firms seeking to list abroad. In 2014 mainland Chinese companies constituted about 50% of the firms listed on the Hong Kong Stock Exchange and accounted for about 60.1% of the Exchange's market capitalization. During the past decade, as Hong Kong's manufacturing industry moved to the mainland, its service industry has grown rapidly. Credit expansion and tight housing supply conditions have caused Hong Kong property prices to rise rapidly; consumer prices increased by more than 4.4% in 2014. Lower and middle income segments of the population are increasingly unable to afford adequate housing. Hong Kong continues to link its currency closely to the US dollar, maintaining an arrangement established in 1983. In 2014, Hong Kong and China signed a new agreement on achieving basic liberalization of trade in services in Guangdong Province under the Closer Economic Partnership Agreement, adopted in 2003 to forge closer ties between Hong Kong and the mainland. The new measures, effective from March 2015, cover a negative list and a most-favored treatment provision, and will improve access to the mainland's service sector for Hong Kong-based companies.

 

Source : CIA

Company Name and Address

 

CHANGHONG (HONGKONG) TRADING LTD.

 

ADDRESS:                   Room 1412, 14/F., West Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan, Hong Kong.

 

PHONE:                        852-3690 2366

 

FAX:                             852-3690 2108

 

E-MAIL:                        eileen.yang@changhong.com

 

 

MANAGEMENT

 

Managing Director:        Ms. HU Jia

 

 

SUMMARY

 

Incorporated on:            24th May, 2005.

 

Organization:                 Private Limited Company.

 

Issued Share Capital:     HK$200,000,000.00

 

Business Category:       Electric Product Trader.

 

Group Turnover:            RMB59,503,900,569.63 Yuan  (Year ended 31-12-2014)

 

Company Employees:  13. (Including associates)

 

Group Employees :       61,660  (As at 13-12-2014)

 

Main Dealing Banker:     Bank of China (Hong Kong) Ltd., Hong Kong.

 

Banking Relation:          Good.

 

 

ADDRESS

 

Registered Head Office:-

Room 1412, 14/F., West Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan, Hong Kong.

 

Holding Company:-

Sichuan Changhong Electric Co. Ltd. [Changhong], China.

 

Ultimate Holding Company:-

Sichuan Changhong Electronic Holdings Co. Ltd., China.

 

Affiliated/Associated Companies:-

Changhong Group of Companies

Apex Digital Inc., British Virgin Islands.

Apex Honour Resources Ltd., British Virgin Islands.

BVCH Optronics (Sichuan) Co. Ltd., China.

Changchun Changhong Electric Technologies Co. Ltd., China.

Changhong (Hong Kong) Enterprises Ltd., Hong Kong.

Changhong Deutschland Ltd., Germany.

Changhong Electric (Australia) Pty. Ltd., Australia.

Changhong Electric India Pvt. Ltd., India.

Changhong Electric Middle East FZE, UAE.

Changhong Europe Electric s.r.o., Czech Republic.

Changhong IT (Hong Kong) Information Products Co. Ltd., Hong Kong.

Changhong IT Information Products Co. Ltd., China.

Changhong Jiahua Holdings Ltd., Hong Kong.

Changhong Overseas Development Ltd., Hong Kong.  (Same address)

Changhong Ruba Trading Co. (Pvt) Ltd., Pakistan.

Changhong Russia Electric Co. Ltd., Russia.

Electra Investments B.V., the Netherlands.

Fit Generation Holding Ltd., British Virgin Islands.

Guangdong Changhong Digital Technology Co. Ltd., China.

Guangdong Changhong Electronics Co. Ltd., China.

Guohong Communications Digital Group Co. Ltd., China.

Hefei Changhong Industry Co. Ltd., China.

Hefei Meiling Co. Ltd., China.

Huayi Compressor Co. Ltd., China.

Jiangsu Changhong TV Co. Ltd., China.

Mianyang Guohong Communication Digital Group Co. Ltd., China.

Orion OLED Co. Ltd., South Korea.

Orion PDP Co. Ltd., South Korea.

P.T. Changhong Electric Indonesia, Indonesia.

Sichuan CCO Display Technology Co. Ltd., China.

Sichuan Changhong Electric Power Co. Ltd., China.

Sichuan Changhong Network Technologies Co. Ltd., China.

Sichuan Changhong New Energy Technology Co. Ltd., China.

Sichuan Changhong Precision Electronics Technology Co. Ltd., China.

Sichuan Changhong-Sinew Technologies Co. Ltd., China.

Sichuan TECO Changhong Precision Co. Ltd., China.

Sterope Investments B.V., the Netherlands.

Sufficient Value Group Ltd., British Virgin Islands.

etc.

 

 

BUSINESS REGISTRATION NUMBER

 

35656159

 

 

COMPANY FILE NUMBER

 

0972481

 

 

MANAGEMENT

 

Managing Director:        Ms. Hu Jia

Marketing Manager:       Ms. Yang Lu, Eileen

Representative:             Mr. Wu Xiangtao

 

 

ISSUED SHARE CAPITAL

 

HK$200,000,000.00

 

 

SHAREHOLDER

(As per registry dated 24-05-2015)

 

Name

 

No. of shares

Sichuan Changhong Electric Co. Ltd.

35 East Mian Xing Road, High-Tech Park, Mian Yang, Sichuan, China.

 

200,000,000

=========

 

 

DIRECTORS

(As per registry dated 24-05-2015)

 

Name

(Nationality)

 

Address

HU Jia

No. 321, Block 76, No. 5 Yue Jin Lu, Fu Cheng Qu, Mian Yang Shi, Si Chuan Sheng, China.

 

WU Xiangtao

No. 161, Block 13, 5 Sheng Huo Qu, No. 5 Yue Jin Lu, Fu Cheng Qu, Mian Yang Shi, Si Chuan Sheng, China.

 

CHEN Hua

Purchase Department, 35# East Mian Xing Road, Hi-Tech Park, Mian Yang, Sichuan, China.

 

SHI Qiang

No. 111, 71 Chuang, No. 5 Yue Jin Road, Fu Cheng District, Mian Yang City, Sichuan Province, China.

 

YAO Bing

No. 5 Yue Jin Road, Fu Cheng District, Mian Yang City, Sichuan Province, China.

 

 

SECRETARY

(As per registry dated 24-05-2015)

 

Name

Address

Co. No.

SBC Corporate Services Ltd.

Room B, 10/F., Tower A, Billion Centre, 1 Wang Kwong Road, Kowloon Bay, Kowloon, Hong Kong.

0618863

 

 

HISTORY

 

The subject was incorporated on 24th May, 2005 as a private limited liability company under the Hong Kong Companies Ordinance.

 

The subject was formerly located at Room 3701, 37/F., West Tower, Shun Tak Centre, 168-200 Connaught Road Central, Sheung Wan, Hong Kong, moved to the present address in 29th May, 2012.

 

Apart from these, neither material change nor amendment has been ever traced and noted.

 

 

OPERATIONS

 

Activities:                      Importer and Exporter.

 

Lines:                           Air-conditioners, electronic products, other electric appliances.

 

Employees:                  13.  (Including associates)

 

Group Employees :       61,660  (As at 13-12-2014)

 

Materials/Commodities: Imports raw materials from European countries, some Asian countries and finished                                              products from China.

 

Markets:                        Europe, Australia, North America, etc.

 

Group Turnover:-

RMB41,711,808,864.18 Yuan  (Year ended 31-12-2010)

RMB52,003,328,326.13 Yuan  (Year ended 31-12-2011)

RMB52,334,149,134.26 Yuan  (Year ended 31-12-2012)

RMB58,875,274,661.52 Yuan  (Year ended 31-12-2013)

RMB59,503,900,569.63 Yuan  (Year ended 31-12-2014)

RMB27,308,196,600.54 Yuan  (6 months ended 30-06-2014)

RMB29,853,897,906.45 Yuan  (6 months ended 30-06-2015)

 

Company Turnover:       RMB2,531,766.47 Yuan  (Year ended 31-12-2014)

RMB1,264,281.20 Yuan  (6 months ended 30-06-2015)

 

Terms/Sales:                 L/C or as per contracted.

 

Terms/Buying:               Various terms.

 

 

FINANCIAL INFORMATION

 

Issued Share Capital:     HK$200,000,000.00

 

Mortgage or Charge:     (See attachment)

 

Total Assets of Company:

RMB1,414,062.13 Yuan  (Year ended 31-12-2014)

RMB1,529,771.24 Yuan  (6 months ended 30-06-2015)

 

Net Assets of Company:

RMB137,962.79 Yuan  (Year ended 31-12-2014)

RMB140,050.80 Yuan  (6 months ended 30-06-2015)

 

Group Net Profit Attributable to Shareholders:-

RMB292,253,972.55 Yuan   (Year ended 31-12-2010)

RMB396,198,844.63 Yuan   (Year ended 31-12-2011)

RMB325,328,360.29 Yuan   (Year ended 31-12-2012)

RMB512,481,605.58 Yuan   (Year ended 31-12-2013)

RMB  58,857,812.40 Yuan   (Year ended 31-12-2014)

(RMB181,133,760.16) Yuan  (6 months ended 30-06-2014)

(RMB190,888,073.32) Yuan  (6 months ended 30-06-2015)

 

Company Net Profit:

RMB20,391.74 Yuan   (Year ended 31-12-2014)

(RMB  4,013.73 Yuan)  (6 months ended 30-06-2015)

 

Profit or Loss:               Group & Company made a loss in the fist half of 2015.

 

Condition:                     Keeping in an active and good condition.

 

Facilities:                      Making active use of general banking facilities.

 

Payment:                      Met trade commitments as contracted.

 

Commercial Morality:     Good.

 

Bankers:-

Bank of China (Hong Kong) Ltd., Hong Kong.

RB International Finance (Hong Kong) Ltd., Hong Kong.

Industrial & Commercial Bank of China (Asia) Ltd., Hong Kong.

Deutsche Bank AG, Hong Kong Branch.

Société Générale, Hong Kong Branch.

 

Standing:                      Very Good.

 

 

GENERAL

 

Changhong (Hongkong) Trading Ltd. is a wholly-owned subsidiary of Sichuan Changhong Electric Co. Ltd. [Changhong] which is a China-based and listed firm.  The subject is responsible for overseas marketing and re‑exporting the products of Changhong.

 

The subject is also known as Changhong Hongkong in abbreviation.  It has increased its share capital to HK$200 million in March 2012.

 

The subject has had another associated firm known as Changhong Jiahua Holdings Ltd. [Jiahua/formerly China Data Broadcasting Holdings Ltd.].  Jiahua is a listed firm in Hong Kong bearing the stock code 8016.

At present, Changhong and its subsidiaries are holding 52.53% of Jiahua’s interests.

 

Since Changhong is the largest shareholder of Jiahua, it has had the right to control the Jiahua Group.  Now, Jiahua has become an arm for overseas development of Changhong.

 

Established in 1958, Changhong is a listed firm in China.  It became a public traded company with shares listed on the Shanghai Stock Exchange bearing stock code 600839 in March 1994.  Changhong is located at Mianyang City, Sichuan Province, China.  Changhong is now one of the largest Chinese consumer electronics providers specialized in R&D, manufacturing and marketing consumer electronics products.

 

Today, Changhong has set up branches and joint ventures with 61,942 employees worldwide.  It has established overseas branches and representative offices in the United States, Europe, Australia, Russia, Turkey, Thailand, India, Southeast Asia and the Middle East and is continuing setting up branches and offices in the other markets.  With a world-class manufacturing facility, claimed by Changhong, it has got the ISO 9001 and ISO 14001 certifications.  Its products are in conformity with international standards such as 3C, UL, FCC, FDA, CE, SASO, GS, CB, etc.  Changhong has more than 20,000 Sales and Service outlets throughout the world.  Its products have found ready markets in over 100 countries and regions.

 

Changhong for 15 consecutive years has been ranked the first in the domestic market as one out of every four TVs in China is manufactured by it.  It has established many joint laboratories with Toshiba, Sanyo, GE, Microsoft, TI, Samsung, LG, Philips, etc.  It also has established R&D centres in Shanghai and Shenzhen Special Economic Zone in China, American Silicon Valley, and Japan. Changhong’s goal is to actively participate in the development of a global digital industry.

 

With advantages of four R&D and manufacturing bases located in Mianyang, Zhongshan, Nantong, and Changchun in China, Changhong has become an industry leader and the largest supplier of consumer electronics in Asia.

 

In 2014, Changhong’s turnover amounted to RMB59,503.9 million Yuan, grew by 1.1% as compared with RMB58,875.3 million Yuan in 2013; net profit attributable to shareholders for the year was RMB88.9 million Yuan, decreased by 88.5% as compared with RMB512.5 million Yuan in 2013.

 

For the year ended 31st December, 2014, the turnover of the subject amounted to RMB2.5 million Yuan.  Its net profit was just over RMB20,000 Yuan.  For the six months ended 30th June, 2015, the subject’s turnover was RMB1.3 million Yuan.  It made a loss of over RMB4,000 Yuan in the period.

 

As at 31st December 2014, Changhong Group had about 61,660 employees as at end of 2014.  The subject is fully supported by Changhong.

 

The history of the subject in Hong Kong is over ten years and three months.

 

On the whole, consider it good for normal business engagements.

 

 

REMARKS

 

Brief personal profile of the principal directors:-

 

Mr. WU Xiangtao, aged 41, joined the subject as Executive Director and Deputy Managing Director in May 2008.  Mr. Wu has ceased to hold the senior management position but remains as a Director.  Mr. Wu is responsible for the strategies of the Group’s trading business of consumer electronic products.  He holds a Master Degree in Business Administration from Southwestern University of Finance and Economics and a Bachelor Degree in International Trade and Economics from Shandong University in the PRC and recently obtained a Master Degree in Business Administration from University of Glasgow, United Kingdom.

He has more than 18 years of experience in the consumer electronics industry.

 

 

MORTGAGE OR CHARGE

 

Date

Description of Instrument

 

Mortgagee

21-07-2008

Third Party Charge Over Cash Deposit

RZB Austria Finance (Hong Kong) Ltd.  [Now known as RB International Finance (Hong Kong) Ltd.]

20-05-2011

Trade Finance Security Assignment

Industrial & Commercial Bank of China (Asia) Ltd., Hong Kong.

23-08-2011

An Agreement of Cash Pledge

Deutsche Bank (China) Co. Ltd., Guangzhou Branch on behalf of Deutsche Bank AG, Hong Kong Branch.

23-08-2011

Security Agreement

Deutsche Bank AG, Hong Kong Branch.

05-03-2012

Security Agreement

Deutsche Bank AG, Singapore Branch.
One Raffles Quay, South Tower, #14-00, Singapore 048593.

05-03-2012

An Agreement of Cash Pledge

Deutsche Bank (China) Co. Ltd., Guangzhou Branch.
2202-03 Teem Tower, 2008 Tianhe Road, Guangzhou 510620, China.

29-08-2013

HK Account Charge dated 29th August 2013 executed by the Chargor, the chargee and Societe Generale, Hong Kong Branch as Account Bank

Societe Generale
17, Cours Valmy Paris-La Defense Cedex FR 92987, France.

03-04-2014

Charge Over Securities and Deposits with the Bank

The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

03-04-2014

Charge Over Securities and Deposits with the Bank (Unlimited Amount)

The Hongkong & Shanghai Banking Corp. Ltd., Hong Kong.

 


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.66.08

UK Pound

1

Rs.100.32

Euro

1

Rs.73.81

 

 

 

 

 

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%)

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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.