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MIRA INFORM REPORT
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Report No. : |
495015 |
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Report Date : |
05.03.2018 |
IDENTIFICATION DETAILS
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Name : |
ITOCHU CORPORATION |
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Registered Office : |
3-1-3 Umeda Kitaku Osaka |
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Country : |
Japan |
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Financials (as on) : |
31.03.2017 |
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Date of Incorporation : |
Dec., 1949 |
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Com. Reg. No.: |
1200-01-077358 (Osaka-Chuoku) |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
General Trading House. |
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No. of Employees : |
4,285 |
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++ |
Minimum Risk |
Business dealings permissible with minimum
risk of default |
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Maximum Credit Limit : |
Yen 110,631.9 Million |
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Status : |
Excellent |
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Payment Behaviour : |
Regular |
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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 (30.09.2017) |
Current Rating (31.12.2017) |
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Japan |
A1 |
A1 |
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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 |
JAPAN - ECONOMIC OVERVIEW
Over the past 70 years, government-industry cooperation, a strong work ethic, mastery of high technology, and a comparatively small defense allocation (slightly less than 1% of GDP) have helped Japan develop an advanced economy. Two notable characteristics of the post-World War II 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 have significantly eroded under the dual pressures of global competition and domestic demographic change.
Measured on a purchasing power parity basis that adjusts for price differences, Japan in 2017 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. For three postwar decades, overall real economic growth was impressive - a 10% average in the 1960s, 5% in the 1970s, and 4% in the 1980s. Growth slowed markedly in the 1990s, averaging just 1.7%, largely because of the aftereffects of inefficient investment and the collapse of an asset price bubble in the late 1980s, which entailed considerable 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.
Japan enjoyed an 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. Led by the Bank of Japan’s aggressive monetary easing, Japan is making modest progress in ending deflation, but demographic decline – a low birthrate and an aging, shrinking population – poses a major long-term challenge for the economy. The government currently faces the quandary of balancing its efforts to stimulate growth and institute economic reforms with the necessity of addressing its sizable public debt, which stands at 235% of GDP. To help raise government revenue, Japan adopted legislation in 2012 to gradually raise the consumption tax rate. However, the first such increase, in April 2014, led to another recession, so Prime Minister ABE has twice postponed the next increase, now scheduled for October 2019. Structural reforms to unlock productivity are seen as central to strengthening the economy in the long-run.
Scarce in critical natural resources, Japan has long been dependent on imported energy and raw materials. After the complete shutdown of Japan’s nuclear reactors following the earthquake and tsunami disaster in 2011, Japan's industrial sector has become even more dependent than before on imported fossil fuels. However, ABE’s government is seeking to restart nuclear power plants that meet strict new safety standards and is emphasizing nuclear energy’s importance as a base-load electricity source. In August 2015, Japan successfully restarted one nuclear reactor at the Sendai Nuclear Power Plant in Kagoshima prefecture, and several other reactors around the country have since resumed operations; however, opposition from local governments has delayed several more restarts that remain pending. Reforms of the electricity and gas sectors, including full liberalization of Japan’s energy market in April 2016 and gas market in April 2017, constitute an important part of Prime Minister Abe’s economic program.
In October 2015, Japan and 11 trading partners reached agreement on the Trans-Pacific Partnership (TPP), a pact that had promised to open Japan's economy to increased foreign competition and create new export opportunities for Japanese businesses. Japan was the first country to ratify the TPP in December 2016; the United States signaled its withdrawal from the TPP in January 2017, and in November 2017 the remaining 11 countries agreed on the core elements of a modified agreement, which they renamed the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP).
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Source
: CIA |
Company name and address
ITOCHU CORPORATION
REGD NAME: Itochu
Shoji KK
MAIN OFFICE: 2-5-1
Kitaaoyama Minatoku Tokyo 107-8807 JAPAN
Tel:
03-3497-2121 Fax: 03-3497-4141
*.. Registered at:
3-1-3 Umeda Kitaku Osaka, as given
E-Mail address: webmaster@itochu.co.jp
ACTIVITIES
General trading
house
BRANCHES
Osaka, Nagoya,
Fukuoka, Hiroshima, Sapporo, other (Tot 9)
OVERSEAS
North/South
America, Europe, China, S/E Asia, & other (Tot 103 over 80 overseas
countries)
CHIEF EXEC
MASAHIRO OKAFUJI,
PRES & CEO
Yen Amount: In million Yen, unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 4,838,464 M
PAYMENTS REGULAR CAPITAL Yen 253,448 M
TREND SLOW WORTH Yen
2,401,893 M
STARTED 1949 EMPLOYES 4,285
COMMENT
NATION’S LEADING
GENERAL TRADING HOUSE.
FINANCIAL SITUATION CONSIDERED FAIR AND GOOD
FOR ORDINARY BUSINESS ENGAGEMENTS.
MAX CREDIT LIMIT:
YEN 110,631.9 MILLION, 30 DAYS NORMAL TERMS.
HIGHLIGHTS
This is major
general trading house, currently top textile trader among domestic trading companies,
with comprehensive strength in all areas of the textile industry from upstream
to down-stream operations, while actively trying to expand into textile retailing. Also strong in
food industry, machinery plants, chemicals, energy and condominiums. Further aggressive in satellite
communications to lead other trading houses in telecom & China businesses. Has stake in Perfect TV satellite broadcaster. Acquired 3% stake
in UNY, general supermarket operator based in Tokai area for collaboration in
merchandise development and operation in China. Constructing export terminals
on West Coast jointly with major US grain firm as strategic base for export to China & other Asian countries. Capital spending
is at Yen 350 billion-plus in the March 2012 and March 2013 terms for metals & energy resources. The company is
eager to acquire additional new metals resources in light of opportunities
presented by the deteriorating market, and will focus on iron ore and coal.
FINANCIAL INFORMATION
The revenues for
Mar/2017 fiscal term amounted to Yen 4,838,464 million, a 5% down from Yen
5,083,536 million in the previous term.
The recurring profit was posted at Yen 499,855 million and the net
profit at Yen 240,376 million, respectively, compared with Yen 322,749 million recurring
profit and Yen 240,376 million net profit, respectively, a year ago.
For the current
term ending Mar 2018 the recurring profit is projected at Yen 550,000 million
and the net profit at Yen 415,000 million, respectively, on a 20% rise in
turnover, to Yen 5,800,000 million.
The financial
situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen
110,631.9 million, on 30 days normal terms.
REGISTRATION
Date
Registered: Dec 1949
Regd
No.: 1200-01-077358
(Osaka-Chuoku)
Legal
Status: Limited
Company (Kabushiki Kaisha)
Authorized: 3,000 million shares
Issued:
1,662,889,502 shares
Sum:
Yen
253,448 million
Major shareholders
(%): Company’s T5reasury Stock (5.6), Japan Trustee Services Bank T (5.4),
Master Trust Bank of Japan T (5.3), CP Worldwide Investment (3.8), Mizuho Bank
(2.3), Mitsui Sumitomo Ins (1.8), Sompo Japan Nipponkoa Ins (1.5), Barclays
Securities Japan (1.5); foreign owners (35.1)
No.
of shareholders: 161,556
Listed
on the S/Exchange (s) of: Tokyo
Managements: Masahiro
Okafuji, pres; Hitoshi Okamoto, s/mgn dir; Yoshihisa Suzuki, s/mgn dir;
Fumihiko Kobayashi, s/mgn dir; Takeshi Hachimura, mgn dir; Ichiro Fujisaki,
dir; Tsutomu Kawakita, dir; Atsuko Muraki, dir; Harufumi Mochizuki, dir
Nothing detrimental is known as to the
commercial morality of executives.
Related
companies: Itochu Techno Solutions, Itochu Shokuhin, Itochu Enex, other
OPERATION
Activities: A general
trading house;
Sales breakdown by divisions: Textiles (11%),
machinery (7%), metals (4%), energy & chemicals (30%), foodstuffs
(22%), ICT, general products & realty (25%)
Overseas
trading ratio: (50%)
Clients: [Wholesalers,
mfrs] Itochu Shokuhin, Nippon Access, Idemitsu Kosan Kaisha, Japan Gas Energy,
JX Nippon Oil & Energy Corp, other.
No. of accounts: 3,000
Domestic areas of activities: Nationwide
Suppliers: [Mfrs,
wholesalers, carmakers] Mazda Motor, Nippon Steel, Isuzu Motors, Nissin Food
Products, JGC Corp, Dole, Nissin Foods, Dole Japan Inc, JX Nippon Oil &
Energy Corp, Japan Petroleum Exploration Co, Sakhalin Oil & Gas, Qatar
International Petroleum Marketing, other.
Payment
record: Regular
Location: Business area in Tokyo. Office premises at the caption address are
owned and maintained satisfactorily.
Bank
References:
Mizuho
Bank (Uchisaiwaicho)
SMBC
(Osaka H/O)
Relations:
Satisfactory
FINANCES
(In Million Yen)
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Terms Ending: |
31/03/2018 |
31/03/2017 |
31/03/2016 |
31/03/2015 |
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Annual
Sales |
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5,800,000 |
4,838,464 |
5,083,536 |
5,591,435 |
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Recur.
Profit |
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550,000 |
499,855 |
322,749 |
418,515 |
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Net
Profit |
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415,000 |
352,221 |
240,376 |
300,569 |
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Total
Assets |
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8,122,032 |
8,036,395 |
8,560,701 |
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Current
Assets |
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3,700,815 |
3,667,502 |
4,137,952 |
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Current
Liabs |
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2,700,405 |
2,473,198 |
2,486,511 |
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Net
Worth |
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2,401,893 |
2,193,677 |
2,433,202 |
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Capital,
Paid-Up |
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253,448 |
253,448 |
253,448 |
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Div.Ttl
in Million (¥) |
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83,037 |
75,992 |
81,483 |
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<Analytical Data> |
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(%) |
(%) |
(%) |
(%) |
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S.Growth Rate |
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19.87 |
-4.82 |
-9.08 |
0.07 |
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Current Ratio |
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.. |
137.05 |
148.29 |
166.42 |
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N.Worth Ratio |
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.. |
29.57 |
27.30 |
28.42 |
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R.Profit/Sales |
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9.48 |
10.33 |
6.35 |
7.48 |
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N.Profit/Sales |
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7.16 |
7.28 |
4.73 |
5.38 |
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Return On Equity |
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.. |
14.66 |
10.96 |
12.35 |
Notes: Forecast (or estimated) figures for the 31/03/2018
fiscal term.
FOREIGN EXCHANGE RATES
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Currency |
Unit
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Indian Rupees |
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US Dollar |
1 |
INR 65.23 |
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1 |
INR 89.71 |
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Euro |
1 |
INR 79.50 |
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Yen |
1 |
INR 0.62 |
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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DIV |
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Report Prepared
by : |
NIT |
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
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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.