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3decades

 

MIRA INFORM REPORT

 

 

Report No. :

517273

Report Date :

27.06.2018

 

IDENTIFICATION DETAILS

 

Name :

PETROCHEMICAL INDUSTRIES COMPANY KSC (PIC)

 

 

Registered Office :

Petrochemical Industries Company Building, Khalid Ibn Waleed Street, PO Box: 1084, Safat 13011

 

 

Country :

Kuwait

 

 

Financials (as on) :

31.03.2017 [Summarized]

 

 

Date of Incorporation :

23.07.1963

 

 

Com. Reg. No.:

9049, Safat

 

 

Legal Form :

Kuwaiti Shareholding Company - KSC

 

 

Line of Business :

Producers of petrochemicals

 

 

No. of Employees :

535

 

 

RATING & COMMENTS

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

 

MIRA’s Rating :

A+

 

Credit Rating

Explanation

Rating Comments

A+

Low Risk

Business dealings permissible with low 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

(31.12.2017)

Current Rating

(01.04.2018)

Kuwait

A1

A2

 

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

 

 

KUWAIT - ECONOMIC OVERVIEW

 

Kuwait has a geographically small, but wealthy, relatively open economy with crude oil reserves of about 102 billion barrels - more than 6% of world reserves. Kuwaiti officials plan to increase production to 4 million barrels of oil equivalent per day by 2020. Petroleum accounts for over half of GDP, 92% of export revenues, and 90% of government income.

In 2015, Kuwait, for the first time in 15 years, realized a budget deficit after decades of high oil prices; in 2016, the deficit grew to 16.5% of GDP. Kuwaiti authorities announced cuts to fuel subsidies in August 2016, provoking outrage among the public and National Assembly, and the Amir dissolved the government for the seventh time in ten years. In 2017 the deficit was reduced to 7.2% of GDP, and the government raised $8 billion by issuing international bonds. Despite Kuwait’s dependence on oil, the government has cushioned itself against the impact of lower oil prices, by saving annually at least 10% of government revenue in the Fund for Future Generations.

Kuwait has failed to diversify its economy or bolster the private sector, because of a poor business climate, a large public sector that employs about 74% of citizens, and an acrimonious relationship between the National Assembly and the executive branch that has stymied most economic reforms. The Kuwaiti Government has made little progress on its long-term economic development plan first passed in 2010. While the government planned to spend up to $104 billion over four years to diversify the economy, attract more investment, and boost private sector participation in the economy, many of the projects did not materialize because of an uncertain political situation or delays in awarding contracts. To increase non-oil revenues, the Kuwaiti Government in August 2017 approved draft bills supporting a Gulf Cooperation Council-wide value added tax scheduled to take effect in 2018.

 

Source : CIA

 

SUMMARY

 

Company Name                                    : PETROCHEMICAL INDUSTRIES COMPANY KSC (PIC)

Country of Origin                                   : Kuwait

Legal Form                                           : Kuwaiti Shareholding Company - KSC

Registration Date                                  : 23rd July 1963

Commercial Registration Number           : 9049, Safat

Membership Number                             : 544

Issued Capital                                       : KD 600,000,000

Paid up Capital                                     : KD 600,000,000

Total Workforce                                     : 535

Activities                                               : Producers of petrochemicals

Financial Condition                                : Good

Payments                                             : Regular

Operating Trend                                    : Steady

 

 

 

 

COMPANY NAME

 

PETROCHEMICAL INDUSTRIES COMPANY KSC (PIC)

 

 

ADDRESS

 

Registered & Physical Address

 

Building                        : Petrochemical Industries Company Building

Street               : Khalid Ibn Waleed Street

 

PO Box                        : 1084

 

Town                : Safat 13011

Country             : Kuwait

 

Telephone         : (965) 23851000 / 23211000 / 22448280 / 22422141

Facsimile          : (965) 23211171 / 22405791 / 22445913

Email                : media@pic.com.kw

 

Premises

 

Subject operates from a large suite of offices that are owned and located in the Central Business Area of Safat.

 

Branch Office (s)

 

     Location                                                                                           Description

 

·       PO Box: 9116                                                                                   Owned fertiliser plant

Ahmadi 61002

Tel: (965) 23260622 / 23261544

Fax: (965) 23261860 / 23260343 / 23262450

 

·       PO Box: 9453                                                                                   Owned Poly-Propylene Plant

Ahmadi 61005

Tel: (965) 23262032

Fax: (965) 23261779

 

·       Subject operates a further 9 branches located throughout Kuwait.

 

 

KEY PRINCIPALS

 

     Name                                                                                               Position

 

·       Ahmad Abdulla Habeeb                                                                    Chairman

 

·       Hashem Hashem                                                                              Vice Chairman

 

·       Mohammad Abdullateef Al Farhoud                                                   Director

 

·       Ahmed Saleh Al Jimaz                                                                      Director

 

·       Osamah Abdulrahman Al Duaij                                                          Director

 

·       Esam Naser Al Houti                                                                         Director

 

·       Abdullah Ali Al Azmi                                                                         Director

 

·       Ms Hosnia Sayed Hashim                                                                 Deputy Chief Executive Officer Olefins

 

·       Mejbel Omair Mejbel Alshammari                                                       Deputy Chief Executive Officer Fertilizers

 

·       Ibrahim Mohammad Ibrahim Almusaiteer                                            Finance Manager

 

 

LEGAL FORM & OWNERS

 

Date of Establishment  : 23rd July 1963

 

Legal Form                  : Kuwaiti Shareholding Company - KSC

 

Commercial Reg. No.   : 9049, Safat

 

Membership No.           : 544

 

Issued Capital              : KD 600,000,000

 

Paid up Capital            : KD 600,000,000

 

Name of Shareholder (s)                                     Percentage

 

·       Kuwait Petroleum Corporation (KPC) *                           100%

     Salhiya Complex, 1st – 15th Floors

     Fahed Al Salem Street

     PO Box: 26565

     Safat 13126

     Tel: (965) 22455455 / 22463318

     Fax: (965) 22467159 / 22423371 / 22451403

 

*    Kuwait Petroleum Corporation (KPC) is wholly owned by the Government of Kuwait and is responsible to the Ministry of Oil.

 

 

AFFILIATED COMPANIES

 

Subject is a wholly owned subsidiary of Kuwait Petroleum Corporation (KPC), which has overall responsibility for Kuwait’s local and foreign oil industry investments. The following concerns are wholly or partly owned by KPC:

 

     Name                                                                                                           Percentage Held

 

·       Kuwait Oil Co (KOC)                                                                                             100 %

PO Box: 9758

Ahmadi 61008

       Tel: (965) 3989111 / 3984111

Fax: (965) 3982661

 

·       Kuwait National Petroleum Co (KNPC)                                                                   100 %

PO Box: 70

Safat 13001

Tel: (965) 2420121 / 2449401

Fax: (965) 2442954

 

·       Kuwait Oil Tanker Co (KOTC)                                                                     100 %

PO Box: 810

Safat 13009

Tel: (965) 2455455

Fax: (965) 2445907

 

·       Kuwait Foreign Petroleum Exploration Co (KUFPEC)                                              100 %

PO Box: 5291

Safat 13053

Tel: (965) 2421677

Fax: (965) 2437985

 

·       Kuwait Santa Fe Braun for Engineering & Petroleum Enterprises KSC                     100 %

PO Box: 9282

Ahmadi 61003

Tel: (965) 3985011

Fax: (965) 3981030

 

·       Kuwait Aviation Fuelling Co KSC (KAFCO)                                                             100 %

PO Box: 1654

Safat 13017

Tel: (965) 4330507 / 4330483

Fax: (965) 4330475

    

·       SFIC Holdings (Cayman) Inc                                                                                  100 %

Cayman Islands

 

·       KPC Holdings (Aruba) AEC                                                                                   100 %

 

·       Petrochemical Industries Holdings NV                                                                   100 %

 

·       KP North Sea Holdings Ltd                                                                                   100 %

 

·       Gulf Industrial Investment Co EC                                                                           100 %

 

·       Piccan Holding Inc                                                                                                100 %

Canada

 

·       ME Global BV                                                                                                        50 %

Netherlands

 

·       ME Global Canada Inc                                                                                            50 %

Canada

 

·       Kuwait Drilling Co KSC                                                                                           49 %

 

·       Equate Petrochemical Company                                                                              42.5 %

 

·       Dow Chemical Co                                                                                                   42.5 %

 

·       The Kuwait Olefins Company                                                                                   42.5 %

 

·       Gulf Petrochemical Industries Co (GPIC)                                                                  33 %

     Bahrain

 

·       Sino Arab Chemical Fertilizer Co (SACF)                                                                  30 %

China

 

·       Arabian Oil Company                                                                                              10 %

 

·       Boubyan Petrochemical Co                                                                                      9 %

 

·       Qurain Petrochemical Industries Co                                                                          6 %

 

 

OPERATIONS

 

Activities: Petrochemical Industries Company was founded with the objective of setting up various types of petrochemical industries to promote and diversify the sources of national income through the exploitation of the natural gas that accompanies crude oil reserves.

 
Facilities

 

Subject’s facilities have undergone several phases of expansion and new plants have been constructed over the past few years. The company now claims the largest ammonia and urea manufacturing complex in the Middle East, and an ultra-modern plant for salt and chlorine products. PIC’s fertiliser plants have gone through several stages of expansion, merger and development over the years and now comprise of the following units:

4 - Liquid ammonia plants

3 - Urea plants

1 - Concentrated sulphuric acid plant

 

Production Capacity

 

Product                        Daily Production Capacity        Daily Production Capacity

                                                (Designed)                                (Actual)

 

Salt                                          150 tonnes                                100 tonnes

Chlorine Gas                               75 tonnes                                  38 tonnes

Liquid Chlorine                            50 tonnes                                  25 tonnes

Liquid Caustic Soda                    84 tonnes                                  43 tonnes

Caustic Soda Flakes                    50 tonnes                                  17 tonnes

Solid Caustic Soda                     80 tonnes                                  17 tonnes

Hydrochloric acid                        40 cubic metres                         31 cubic metres

Sodium Hypochlorate                  35 cubic metres                         17 cubic metres

Compressed Hydrogen Gas       303 cubic metres                       129 cubic metres

 

PIC Agents

 

·       Tenant Limited                                                                                                                                  Australia

·       S.K. Global                                      North Korea

·       Transfert Ltd.                                    India

·       Minaz International                            India

·       Ahmed Jaffer & Company (P) Ltd      Pakistan

·       Yordan Obeji & Co                           Jordan

·       Al Matin Co. for Trade & Industry       Syria

·       Omnitrade Marketing                         Lebanon

·       Tunice Negoce                                 Tunisia

·       Mitsubishi Corporation                      Hong Kong

 

Import Countries: United States of America

 

Operating Trend: Steady

 

Subject has a workforce of approximately 535 employees.

 

 

FINANCIAL DATA

 

Financial highlights provided by local sources are given below:

 

Currency: Kuwaiti Dinars (KD)

 

Consolidated Income Statement                                     31/03/17            31/03/16             31/03/15

 

Sales                                                                            115,342,217      120,150,194      137,902,288

Cost of sales                                                                (86,059,696)      (94,725,840)      (117,454,121)

Gross profit                                                                  29,282,521        25,424,354        20,448,167

Share of results of associates                                       112,601,279      108,898,929      144,828,943

Share of results of joint ventures                                    -                       48,719,125        45,391,547

Distribution, general and administrative expenses           (20,281,766)      (30,195,620)      (43,169,881)

Interest income                                                              4,413,805          2,270,835          398,860

Other income                                                                3,289,192          4,206,908          4,515,243

Other expenses                                                             (272,811)           (198,686)           (304,829)

Net gain on foreign exchange                                        1,086,186          2,326,547          6,718,321

Gain on sale of subsidiary and joint venture                    -                       269,427,466      -

Profit before board of directors’ remuneration                130,118,406      430,879,858      178,826,371

Board of directors’ remuneration                                    (42,692)            (43,628)            (41,700)

Profit for the year                                                          130,075,714      430,836,230      178,784,671

 

Consolidated Balance Sheet

 

ASSETS

Non-current assets

Property, plant and equipment                                       86,049,010        90,891,522        96,394,506

Intangible assets                                                           284,306 439,482             439,356

Investments in associates                                              376,572,961      312,563,477      291,708,971

Investments in joint ventures                                          -                       -                       167,078,685

Available for sale financial asset                                    37,400,000        21,120,000        22,000,000

Amount due from the ultimate parent company               196,430,660      153,342,674      135,460,037

Spare parts                                                                   12,296,999        11,715,892        10,179,611

709,033,936      590,073,047      723,261,166

Current assets

Other assets                                                                 57,463,349        57,463,349        57,463,349

Inventories                                                                    5,247,967          2,502,721          3,216,848

Accounts receivable and prepayments                           24,015,020        29,885,542        47,478,087

Amounts due from related parties                                  759,030 940,420             387,358

Bank balances, deposits and cash                                 273,899,337      626,521,096      225,941,980

361,384,703      717,313,128      334,487,622

TOTAL ASSETS                                                            1,070,418,639    1,307,386,175    1,057,748,788

EQUITY AND LIABILITIES

EQUITY

Share capital                                                                 600,000,000      600,000,000      600,000,000

Statutory reserve                                                           209,442,500      196,430,660      153,342,674

Foreign currency translation reserve                               21,285,382        19,831,208        21,003,629

Fair value reserve                                                          26,400,000        10,120,000        11,000,000

Share of associates and joint ventures’ reserves                         (7,3900,874)      (6,188,931)        (6,456,515)

Total equity                                                                   849,737,008      820,192,937      778,889,788

LIABILITIES

Non-current liabilities

Employees’ end of service benefits                               39,002,439        39,985,386        41,580,033

39,002,439        39,985,386        41,580,033

Current liabilities

Other liabilities                                                              25,326,439        25,326,439        25,039,639

Accounts payable and accruals                                      38,541,508        35,429,679        45,351,092

Amounts due to related parties                                      747,371 1,289,180          5,986,202

Dividends payable                                                        117,063,874      385,162,554      160,902,034

181,679,192      447,207,852      237,278,967

Total liabilities                                                               220,681,631      487,193,238      278,859,000

Total equity and liabilities                                               1,070,418,639    1,307,386,175    1,057,748,788

 

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

 

 

BANKERS

 

·       Bank of Kuwait & the Middle East (KSC)

Abdullah Al Salem Street

PO Box: 71

Safat 13001

Tel: (965) 22459771

 

·       National Bank of Kuwait SAK

Abdullah Al Salem Street

PO Box: 95

Safat 13001

Tel: (965) 22421161

 

·       Commercial Bank of Kuwait SAK

Mubarek Al Kabir Street

PO Box: 2861

Safat 13029

Tel: (965) 22411001

 

 

PAYMENT HISTORY

 

Regular

 

 

GENERAL COMMENTS

 

Established in 1963, Petrochemical Industries Company (PIC) now exports its products, including fertilizer, feedstocks, and ammonia, to more than 50 countries worldwide.

 

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.

 

Subject is a wholly owned subsidiary of Kuwait Petroleum Corporation (KPC), which in turn is owned by the government of Kuwait and as the subject is deemed trustworthy for respecting its financial trade commitments.

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

INR 68.17

UK Pound

1

INR 90.47

Euro

1

INR 79.74

KWD

1

INR 226.54

 

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

 

 

INFORMATION DETAILS

 

Analysis Done by :

NIS

 

 

Report Prepared by :

SYL

                                                


 

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)

 

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.