3decades

MIRA INFORM REPORT

Report No. :	503982
Report Date :	20.04.2018

IDENTIFICATION DETAILS

Name :	AREEJ VEGETABLE OILS AND DERIVATIVES SAOC

Registered Office :	Old Nizwa Road, Rusayl Industrial Area, PO Box-22, Rusayl 124

Country :	Oman

Financials (as on) :	31.12.2016

Date of Incorporation :	27.08.1980

Com. Reg. No.:	1/10231/1

Legal Form :	Omani Closed Joint Stock Company

Line of Business :	Subject engaged in the manufacture, bottling and packaging of vegetable oils and related products

No. of Employees :	630

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

Credit Rating	Explanation	Rating Comments
A	Acceptable Risk	Business dealings permissible with moderate risk of default

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

Country Name

Previous Rating

(30.09.2017)

Current Rating

(31.12.2017)

Oman

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	D

OMAN - ECONOMIC OVERVIEW

Oman is heavily dependent on its dwindling oil resources, which generate 84% of government revenue. In 2016, low global oil prices drove Oman’s budget deficit to $11.5 billion, or approximately 19% of GDP, but the budget deficit was reduced to 13% of GDP in 2017 as Oman reduced government subsidies. Oman has limited foreign assets and is issuing debt to cover its deficit.

Oman is using enhanced oil recovery techniques to boost production, but has simultaneously pursued a development plan that focuses on diversification, industrialization, and privatization, with the objective of reducing the oil sector's contribution to GDP from 46% at present to 9% by 2020 in accordance with Oman’s ninth five-year development plan. Tourism and gas-based industries are key components of the government's diversification strategy.

Muscat also has notably focused on creating more Omani jobs to employ the rising number of nationals entering the workforce. However, high social welfare benefits — that had increased in the wake of the 2011 Arab Spring — have challenged the government's ability to effectively balance its budget in light of low export oil prices. In response, Omani officials imposed austerity measures to its gasoline and diesel subsidies in 2016, with further subsidy cuts planned for electricity and liquid petroleum gas. The spending cuts have faced some public opposition, which in 2017 prompted the Omani Government to announce a cap on fuel prices and a plan to provide 25,000 public-sector jobs for Omanis.

Source : CIA

SUMMARY

Company Name : AREEJ VEGETABLE OILS AND DERIVATIVES SAOC

Country of Origin : Oman

Legal Form : Omani Closed Joint Stock Company

Registration Date : 27^th August 1980

Commercial Registration Number : 1/10231/1

Issued Capital : RO 6,900,000

Paid up Capital : RO 6,900,000

Total Workforce : 630

Activities : Manufacture, bottling and packaging of vegetable oils and related products.

Financial Condition : Good

Payments : Regular

Operating Trend : Steady

COMPANY NAME

AREEJ VEGETABLE OILS AND DERIVATIVES SAOC

ADDRESS

Registered & Physical Address

Street : Old Nizwa Road

Location : Rusayl Industrial Area

PO Box : 22

Town : Rusayl 124

Country : Sultanate of Oman

Telephone : (968) 24448000 / 24446270 / 24446458 / 24446459 / 24446460

Facsimile : (968) 24448099 / 24446207 / 24446457

Email : mail@avod.com.om

Premises

Subject operates from a large suite of offices and a factory that are owned and located in the Industrial Area of Rusayl.

KEY PRINCIPALS

Name Position

Nasser Bin Muhammed Bin Nasser Al Hadhramy Chairman

Nasser Bin Khalifa Al Kilbani Vice Chairman

Salem bin Nasser Sultan Al Bortmany Director

H P Kothary Director

Gamal Mohammed Ahmad Director

Prem Maker Director

E M Ashraf Director

Mohammed Bin Suleiman Al Ismaily General Manager

LEGAL FORM & OWNERS

Date of Establishment : 27^th August 1980

Legal Form : Omani Closed Joint Stock Company

Commercial Reg. No. : 1/10231/1

Issued Capital : RO 6,900,000

Paid up Capital : RO 6,900,000

Name of Shareholder (s) Percentage

Mohsin Haider Darwish LLC 30.50%

Dr Omar Bin Abdul Muniem Al Zawawi 24.98%

Omani businessmen and private investors 44.52%

AFFILIATED COMPANIES

Name Percentage Held

Areej Vegetable Oils & Derivatives SAOG LLC 100%

(Previously known as Premium Trading LLC)

United Arab Emirates

Advertising International Company LLC 15%

Oman

OPERATIONS

Activities: Engaged in the manufacture, bottling and packaging of vegetable oils and related products.

Import Countries : Europe and the Far East.

Operating Trend: Steady

Subject has a workforce of approximately 630 employees.

FINANCIAL DATA

Financial highlights provided by local sources are given below:

Currency: Riyal Omani (RO)

Balance Sheet 31/12/16 31/12/15 31/12/16 31/12/15

` Subject Company Group

ASSETS

Non-current assets

Property, plant and equipment 29,291,925 26,526,076 29,291,925 26,526,076

Advance for property, plant and equipment 170,625 766,737 170,625 766,737

Investment in subsidiary 31,500 31,500 - -

29,494,050 27,324,313 29,462,550 27,292,813

Current assets

Inventories 17,602,552 16,067,433 17,602,552 16,067,433

Trade and other receivables 11,513,811 9,759,447 11,513,811 9,759,447

Cash and bank 26,512 14,745 26,512 14,745

29,142,875 25,841,625 29,142,875 25,841,625

Total assets 58,636,925 53,165,938 58,605,425 53,134,438

EQUITY AND

LIABILITIES

EQUITY

Share capital 6,900,000 4,600,000 6,900,000 4,600,000

Share premium - 76,841 - 76,841

Legal reserve 1,688,150 1,533,333 1,688,150 1,533,333

Distributable reserve - 575,976 - 575,976

Retained earnings 4,871,781 6,735,609 4,871,781 6,735,609

Total equity 13,459,931 13,521,759 13,459,931 13,521,759

LIABILITIES

Non-current liabilities

Long term loans 8,332,375 11,198,850 8,332,375 11,198,850

End of service benefits 1,975,959 1,767,366 1,975,959 1,767,366

Deferred taxation 431,518 443,292 431,518 443,292

10,739,852 13,409,508 10,739,852 13,409,508

Current liabilities

Current portion of long term loans 2,866,475 577,650 2,866,475 577,650

Bank overdrafts 256,950 22,209 256,950 22,209

Short term loans 18,915,000 9,306,000 18,915,000 9,306,000

Trade and other payables 12,148,419 15,983,117 12,148,419 15,983,117

Due to a subsidiary 31,500 31,500 - -

Taxation 218,798 314,195 218,798 314,195

34,437,142 26,234,671 34,405,642 26,203,171

Total liabilities 45,176,994 39,644,179 45,145,494 39,612,679

Total equity and liabilities 58,636,925 53,165,938 58,605,425 53,134,438

Statement of Comprehensive Income 31/12/16 31/12/15

Subject Company

Sales 85,702,282 84,023,129

Cost of goods sold (77,257,622) (74,332,716)

Gross profit 8,444,660 9,690,413

Distribution expenses (3,094,715) (3,142,328)

Selling and administrative expenses (3,046,635) (3,189,670)

Other operating income 36,370 34,064

Operating profit 2,339,680 3,392,479

Finance cost (561,484) (326,924)

Remuneration to Chairman and Directors’ sitting fees (23,000) (31,250)

Profit before taxation 1,755,196 3,034,305

Taxation (207,024) (394,398)

Profit and total comprehensive income for the year 1,548,172 2,639,907

Local sources consider subject’s financial condition to be Good.

BANKERS

Bank Dhofar Al Omani Al Fransi

Muttrah Business District

PO Box: 1507, Ruwi 112

Muscat

Tel: (968) 24790466

Fax: (968) 24797246

Oman International Bank SAOG

Al Khuwair

PO Box: 1727, Seeb 111

Muscat

Tel: (968) 24682500

Fax: (968) 24682800

National Bank of Oman

Muttrah Business District

PO Box: 751, Ruwi 112

Muscat

Tel: (968) 24708894 / 24708630 / 24708684

Fax: (968) 24707781 / 24703972

PAYMENT HISTORY

No complaints regarding subject’s payments have been reported.

GENERAL COMMENTS

The subject and its shareholders/owners have been searched in the following databases; Office of Foreign Assets Control (OFAC), United Nations Security Council Sanctions, Australian Sanctions List, US Consolidated Sanctions List, EU Financial Sanctions List and UK Financial Sanctions List and nothing adverse could be found on the exact names listed within the report.

During the course of this investigation nothing detrimental was uncovered regarding subject’s operating history or the manner in which payments are fulfilled. As such the company is considered to be a fair trade risk.

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 65.78
UK Pound	1	INR 93.42
Euro	1	INR 81.39
OMR	1	INR 171.48

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	PRA

Report Prepared by :	KET

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

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 are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

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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.