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MIRA INFORM REPORT
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Report No. : |
487684 |
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Report Date : |
27.01.2018 |
IDENTIFICATION DETAILS
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Name : |
MAJID PLASTIC TRADING LLC |
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Registered Office : |
Al Musaffah Industrial City, 47068, Abu Dhabi |
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Country : |
United Arab Emirates |
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Financials (as on) : |
31.12.2017 |
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Date of Incorporation : |
04.08.1198 |
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Com. Reg. No.: |
38333 |
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Legal Form : |
Limited Liability Company - LLC |
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Line of Business : |
38333 |
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No. of Employees : |
64 |
RATING & COMMENTS
(Mira Inform has adopted New Rating mechanism w.e.f. 23rd
January 2017)
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MIRA’s Rating : |
A |
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Credit Rating |
Explanation |
Rating Comments |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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Status : |
Satisfactory |
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Payment Behaviour : |
No Complaints |
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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
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Country Name |
Previous Rating (30.06.2017) |
Current Rating (30.09.2017) |
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United Arab Emirates |
A2 |
A2 |
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Risk Category |
ECGC
Classification |
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Insignificant |
A1 |
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Low Risk |
A2 |
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Moderately Low Risk |
B1 |
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Moderate Risk |
B2 |
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Moderately High Risk |
C1 |
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High Risk |
C2 |
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Very High Risk |
D |
UNITED
ARAB EMIRATES - ECONOMIC OVERVIEW
The UAE has an open economy with a high per capita income and a sizable annual trade surplus. Successful efforts at economic diversification have reduced the portion of GDP from the oil and gas sector to 30%.
Since the discovery of oil in the UAE nearly 60 years ago, the country has undergone a profound transformation from an impoverished region of small desert principalities to a modern state with a high standard of living. The government has increased spending on job creation and infrastructure expansion and is opening up utilities to greater private sector involvement. The country's free trade zones - offering 100% foreign ownership and zero taxes - are helping to attract foreign investors.
The global financial crisis of 2008-09, tight international credit, and deflated asset prices constricted the economy in 2009. UAE authorities tried to blunt the crisis by increasing spending and boosting liquidity in the banking sector. The crisis hit Dubai hardest, as it was heavily exposed to depressed real estate prices. Dubai lacked sufficient cash to meet its debt obligations, prompting global concern about its solvency and ultimately a $20 billion bailout from the UAE Central Bank and Abu Dhabi Government that was refinanced in March 2014.
The UAE’s dependence on oil is a significant long-term challenge. Low oil prices have prompted the UAE to cut expenditures, including on some social programs, but the UAE has sufficient assets in its sovereign investment funds to cover its deficits. The government reduced fuel subsidies in August 2015, and has announced plans to introduce excise and value-added taxes by January 1, 2018. The UAE's strategic plan for the next few years focuses on economic diversification, promoting the UAE as a global trade and tourism hub, developing industry, and creating more job opportunities for nationals through improved education and increased private sector employment.
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Source
: CIA |
SUMMARY
Company Name : MAJID PLASTIC
TRADING LLC
Country of Origin : Abu Dhabi,
United Arab Emirates
Legal Form :
Limited Liability Company - LLC
Registration Date : 4th
August 1998
Commercial
Registration Number : 38333, Abu
Dhabi
Trade Licence
Number : 1018579
Chamber Membership
Number : 50775
Issued Capital : UAE Dh
300,000
Paid up Capital : UAE Dh
300,000
Total Workforce :
64
Activities :
Distributors of plastic products and plastic raw materials
Financial Condition : Fair
Payments : No Complaints
Operating Trend : Steady
COMPANY
NAME
MAJID PLASTIC TRADING LLC
ADDRESS
Registered &
Physical Address
Location : Al
Musaffah Industrial City
PO Box :
47068
Town :
Abu Dhabi
Country : United Arab
Emirates
Telephone :
(971-2) 5542044 / 5502022
Facsimile :
(971-2) 5542499 / 5502033
Mobile :
(971-52) 6097711
Email : hotpackad@eim.ae
Premises
Subject operates from a medium sized suite of offices that
are rented and located in the Industrial Area of Abu Dhabi.
KEY
PRINCIPALS
Name Nationality Position
·
Beer Kabeer V Pramabeel Indian Managing Director
· Abdul Jabbar Boubya Veetil Indian Director
· Mohamed Abdullatif Ahmed Emirati Director
· Abdul Rasheed - Administration
Officer
LEGAL
FORM & OWNERS
Date
of Establishment : 4th
August 1998
Legal
Form : Limited
Liability Company - LLC
Commercial
Reg. No. :
38333, Abu Dhabi
Trade
Licence No. : 1018579 (Expires 05/03/2018)
Chamber
Member No. : 50775
Issued Capital : UAE
Dh 300,000
Paid up Capital :
UAE Dh 300,000
Name of Shareholder (s) Nationality Percentage Holding
· Mohamed Abdullatif Ahmed Emirati 51%
·
Beer Kabeer V Pramabeel Indian ]
] 49%
· Abdul Jabbar Boubya Veetil Indian ]
Notes to the legal Form The
LLC requires a minimum of two and a maximum of 50 members. Shareholders are
only liable up to the extent of the value of their shares. This type of company
may engage in any form of legitimate
business, with the exception of insurance, banking and investment of funds. The
company is not obliged to publish its accounts. The participation of
non-Emirati in a trade or business in the United Arab Emirates is governed by
the Foreign Business Investment Law, which sets capital requirements and
requires 51 percent Emirati participation in capital and profits. It is common
for the 51 percent to be held by the UAE national on paper only with the
foreign partner(s) providing all the capital requirements for the company and
paying an annual fee to the local partner.
AFFILIATED
COMPANIES
· Majed Plastic Containers
Trading LLC
Dubai
Tel: (971-4) 80518880
OPERATIONS
Activities: Engaged in the import and distribution
of plastic products and plastic raw materials.
Import Countries: Europe and the Far East
Operating Trend: Steady
Subject has a workforce of 64 employees.
FINANCIAL
DATA
Financial highlights provided by local sources are given
below:
Currency: United Arab Emirates Dirham (UAE Dh)
Year SALES
Year Ending 31/12/15: UAE
Dh 24,300,000
Year Ending 31/12/16: UAE
Dh 23,800,000
Year Ending 31/12/17: UAE
Dh 25,000,000
Local sources consider subject’s financial condition to be
Fair.
Note: According to
local Commercial Law, only publicly listed companies are required to publish
their financial information. Financial information on other legal forms can only be obtained from the companies /
businesses directly
BANKERS
·
National Bank of Abu Dhabi
Sheikh
Khalifa Street
PO
Box: 4
Abu
Dhabi
Tel:
(971-2) 6345777 / 6327113 / 6335262
Fax:
(971-2) 6336078
PAYMENT
HISTORY
No complaints regarding subject’s payments have been
reported.
GENERAL
COMMENTS
During the course of this investigation the following
sources were consulted:
- Internal database
- Journals,
directories, media & web searches
- Local Registry
office
- Interview with Abdul Rasheed, Administration Officer
Please note that the correct name of the subject is “Majid Plastic Trading LLC” and not “Majed Plastic
Containers Trading LLC”.
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.
Local sources report that the subject’s operating history is
clear with payment obligations met in a generally timely manner. The financial
position is satisfactory and the company is deemed a fair trade risk.
COUNTRY
OUTLOOK
Recent Developments
The UAE’s economy continues to
slow down as a result of low oil prices and fiscal consolidation weighing on
non-oil growth. Overall real GDP growth is estimated at 2.3 percent in 2016, a
significant drop from the pre-2014 oil shock average of 5 percent (2010-14).
Austerity measures weakened business and consumer confidence and slower growth
in credit to the private sector. This is expected to result in lower non-oil
growth estimated at 2.4 percent in 2016. Hydrocarbon GDP growth is also
expected to slow down to 2 percent in 2016 from an estimated 4.6 percent in
2015. The average rate of inflation is estimated to ease to 3.3 percent in 2016
from 4.1 percent in 2015.
Sustained low oil prices have led
fiscal and external balances to deteriorate, despite significant fiscal
consolidation efforts. Authorities have managed some fiscal consolidation by
raising electricity and water tariffs, removing fuel subsidies and scaling back
capital transfers to Government Related Entities (GREs). Abu Dhabi reduced
reliance on government deposits and issued a US$5 billion Eurobond in April.
Despite these measures, the drop in hydrocarbon revenues has pushed the fiscal
balance down from a comfortable surplus of 10.4 percent of GDP in 2013 to an
estimated deficit of 2.1 percent in 2015 and 3.5 percent in 2016. The Abu Dhabi
and Dubai sovereign wealth funds have recorded lower returns (3 percent y-o-y
fall in 2015 net profits) resulting from global volatility. The current account
surplus also fell from 19.1 percent of GDP in 2013 to 3.3 percent in 2015 and
an estimated 1.3 percent of GDP in 2016.
Monetary policy is tightening, as
is liquidity in the banking system. The Central bank raised its policy rate by
25 basis points in December in response to the US Federal Reserve rate increase
and is expected to continue mirroring the Fed’s rate movements. Reduced
government deposits are resulting in lower liquidity in the banking sector with
deposit growth decelerating to 1.8 percent y-o-y at end-March 2016. A recent
Credit Sentiment Survey revealed that banks are increasingly unwilling to lend,
especially to SME’s. Dubai’s property market continues to soften but does not
pose a systemic risk. Average real estate residential prices fell by 11 percent
in 2015. Increased supply and weakening demand amidst financial tightening
resulting from low oil prices have led to office rents falling by up to 10
percent in Q1 2016. Nevertheless, continued demand in established free zone
developments is sustaining non-oil growth and the real estate loan portfolio
remains resilient.
The UAE is yet to fully develop
its capacity for a comprehensive measurement and analysis of household welfare
across its seven Emirates. Each Emirate has an independent statistics agency,
and while the federal level statistical bureau was established in 2009, the
harmonization of methods and statistical agendas for a country-level welfare
measurement is yet to be accomplished.
Outlook
Growth is expected to slowly
recover, reaching 3 percent in 2018. Oil production is expected to rise due to
investments in oilfield development. Non-oil growth is also projected to
rebound (i) as the expected improvement in oil prices and its positive effects
on confidence and financial conditions dampen the effects of fiscal
consolidation; (ii) as megaproject implementation ramps up ahead of Dubai’s
hosting of Expo 2020; and (iii) as the lifting of sanctions on Iran translates
into increased trade. Fiscal and external balances are expected to improve over
the medium term; with a reversal of the fiscal deficit expected and a rebound
in the current account surplus to 3.2 percent of GDP by 2018.
Progress in economic
diversification, large buffers and safe haven status have strengthened the
resilience of the economy. The UAE is expected to implement a GCC-wide value
added tax (VAT) by 2018, and is considering increasing excise taxes and
introducing corporate tax. Despite pressures key investment areas will be
maintained, as evident by the recently announced nuclear energy project. Abu
Dhabi’s aerospace manufacturing has secured contracts with Airbus and Boeing,
underscoring its commitment to diversification. New bankruptcy and investment
laws are also being prepared with a potential positive impact on investment. In
addition, as anxiety looms over the impact of UK’s decision to leave the EU,
according to a survey of financial investment professionals Dubai’s
competitiveness as a financial hub is not expected to be affected.
Risks and Challenges
However, macro financial risks
are increasing; the financial management of GRE’s megaprojects on the domestic
side, and further sustained drop in oil prices on the external side. In an
environment of low oil prices, macro financial risks could be exacerbated by
declining liquidity in the banking system, increased volatility in the stock
markets, and disruptive declines in the real estate sector. Further, imprudent
management of Dubai’s megaprojects could be a source of macro financial risks
for its GREs, its banks, and ultimately the government. In this context, the
recent hike in interest rates in the US could lead to a tightening of financial
markets and increase the costs of financing.
Structural reforms are needed to
support the move towards a knowledge based economy as envisaged by Vision 2021.
Easing SME access to finance and innovation financing should be a priority.
Reforming labour admissions policies is key for private sector job creation
since under the current sponsorship system expatriate labour mobility is
limited leading to large scale importation of expatriate workers, wages below
marginal productivity and lower incentives to upgrade skills. This in turn
negatively affects productivity, technology choice, and contributes to making
nationals uncompetitive in the private sector.
Key Economic Indicators 2014 2015 2016* 2017* 2018*
Real GDP Growth (%) 3.1
3.8 2.3 2.5 3.0
Inflation Rate (%) 2.3
4.1 3.3 2.8 3.1
Current Account Balance (% of GDP) 10.1 3.3 1.3 3.0 3.2
Fiscal Balance (% of GDP) 5.0 -2.1 -3.5 -1.3 0.2
* forecast
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 63.64 |
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1 |
INR 89.32 |
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Euro |
1 |
INR 78.45 |
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UAE DH |
1 |
INR 17.31 |
Note :
Above are approximate rates obtained from sources believed to be correct
INFORMATION DETAILS
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Analysis Done by
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VIV |
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Report Prepared
by : |
KET |
RATING EXPLANATIONS
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Credit Rating |
Explanation |
Rating Comments |
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A++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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A+ |
Low Risk |
Business dealings permissible with low
risk of default |
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A |
Acceptable Risk |
Business dealings permissible with
moderate risk of default |
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B |
Medium Risk |
Business dealings permissible on a regular
monitoring basis |
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C |
Medium High Risk |
Business dealings permissible preferably
on secured basis |
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D |
High Risk |
Business dealing not recommended or on
secured terms only |
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NB |
New Business |
No recommendation can be done due to
business in infancy stage |
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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)
This report is issued at
your request without any risk and responsibility on the part of MIRA INFORM
PRIVATE LIMITED (MIPL) or its officials.