MIRA INFORM REPORT

 

 

Report No. :

495088

Report Date :

05.03.2018

 

 

 

IDENTIFICATION DETAILS

 

Name :

KONKOLA COPPER MINES PLC

 

 

Registered Office :

Stand No M/1408, Fern Avenue, Chingola

 

 

Country :

Zambia

 

 

Financials (as on) :

31.03.2017 [Consolidated]

 

 

Date of Incorporation :

10.11.1999

 

 

Com. Reg. No.:

43628

 

 

Legal Form :

Limited Corporation 

 

 

Line of Business :

Mining of copper and other metals

 

 

No. of Employees :

10,500

 

 

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

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)

Zambia

B1

B1

 

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

 

 

ZAMBIA - ECONOMIC OVERVIEW

 

Zambia had one of the world’s fastest growing economies for the ten years up to 2014, with real GDP growth averaging roughly 6.7% per annum, though growth slowed during the period 2015 to 2017, due to falling copper prices, reduced power generation, and depreciation of the kwacha. Zambia’s lack of economic diversification and dependency on copper as its sole major export makes it vulnerable to fluctuations in the world commodities market and prices turned downward in 2015 due to declining demand from China; Zambia was overtaken by the Democratic Republic of Congo as Africa’s largest copper producer.

Despite recent strong economic growth and its status as a lower middle-income country, widespread and extreme rural poverty and high unemployment levels remain significant problems, made worse by a high birth rate, a relatively high HIV/AIDS burden, and by market-distorting agricultural and energy policies. Zambia has raised $7 billion from international investors by issuing separate sovereign bonds in 2012, 2014, and 2015, significantly increasing the country’s public debt burden to 56% of GDP; the government plan refinanced $2.8 billion worth of Eurobonds in 2017 to cut debt servicing costs.

Poor management of water resources has also contributed to a power generation shortage, which has hampered industrial productivity and contributed to an increase in year-on-year inflation to more than 20% in 2016. Zambia’s currency, the kwacha, also depreciated sharply against the dollar through 2016, leading the central bank to restrict lending. Rampant spending in recent years has increased the fiscal deficit to over 8% in 2017 and may encourage the government to seek external financing from the IMF to fund the shortfall.

 

Source : CIA

 

 

SUBJECT'S NAME

 

 

Registered Name:

KONKOLA COPPER MINES PLC

Other Names:

None

 

 

ADDRESS AND TELECOMMUNICATION

 

Physical Address:

Stand No M/1408,Fern Avenue, Chingola

Corporate Address:

Abacus Square, Thabo Mbeki Road, Lusaka, Zambia

Postal Address:

Private Bag KCM, 2000

 

Chingola

Country:

Zambia

Phone:

260-212-350604/350001/350000/351000/358000

Fax:

260-212-351234/350000/351249

Email:

corporate.communications@kcm.co.zm/ rakesh.mishra@kcm.co.zm

Website:

www.kcm.co.zm

 

 

CREDIT OPINION

 

 

Financial Index as of December 2017 shows subject firm with a medium risk of credit. However, bank and credit information obtained reveal a history of prompt payments.

 

 

LEGAL

 

 

Legal Form:

Limited Corporation 

Date Incorporated:

10-Nov-1999

Date Started:

31-March-2000

Reg. Number:

43628

VAT Number:

1014765513

Nominal Capital

ZMK. 300,000,001

Subscribed Capital

ZMK. 300,000,001

Subscribed Capital is Subscribed in the following form:

 

Position

Shares

Mr. Tom Albanese

Chairman

 

Mr. Steven Din

CEO

 

Mr. Sharad Kumar Gargiya

Group CFO

 

Mr. Deb Bandyopadhyay

Director

 

Mr. D.D. Jalan

Director

 

Mr. William Kabwe

Director

 

Mr. Arun Kumar

Director

 

Mr. Hastings Mtine

Director

 

Mr. Mwila Lumbwe

Director

 

Vedanta Resources Plc, United Kingdom

Holding Co.

79.40%

Public Investors

Shareholder

12.40%

ZCCM Investments Holdings Plc, Zambia

Shareholder

20.60%

Government of the Republic of Zambia

Shareholder

Golden Share

 

 

RELATED COMPANIES

 

Vedanta Resources Plc, United Kingdom

Parent company.

Listed Below

Subsidiary company.

Listed Below

Affiliated company.

Zambia Copper Investments Ltd, Bermuda,

ZCCM Investments Holdings Plc., Zambia,

GRZ.

Shareholders of subject firm.

None

Branches of the firm

 

 

OPERATIONS

 

Registered to operate c etc

Imports:

India, China, Europe

Exports:

USA, Europe, China India

Trademarks:

None

Terms of sale:

Cash (40%) and 30 days (60%), invoices.

 

 

Main Customers:

Industries & Companies

Employees:

10,500 employees

Vehicles:

More than 40

Territory of sales:

Zambia

Location:

Owned premises, 500,000 square feet,

 

 

AUDITORS AND INSURANCE

 

Auditors:

KPMG, Deloitte LLP

Insurance Brokers:

AIG Assurance

 

 

 

FINANCE

 

 

Currency Reported:

Zambian Kwacha (ZMK.)

Fiscal Year End:

December 31, 2017

Inflation:

According to information given by independent sources, the inflation at December 31st, 2017 was of 13%.

Group Financial Information Submitted Below

 

 

 

BANK

 

 

Bank Name:

Citi Bank or Indo Zambia

Account Number:

000 000 111 0012(Indo Zambia)

Comments:

Good

Other Bank

Development Bank of Zambia

 

 

TRADE REFERENCES

 

Experiences:

Good

 

 

NOTARIAL BONDS

None

 

 

COMMENTS / ADDITIONAL INFORMATION

 

This information was obtained from outside sources other than the subject company itself and confirmed the above subject.

 

 

AFFILIATED COMPANIES

 

BHARAT ALUMINIUM COMPANY LTD

COPPER MINES OF TASMANIA

HINDUSTAN ZINC LTD

MADRAS ALUMINIUM CO. LTD

STERLITE INDUSTRIES LTD

CHIBULUMA MINES PLC

MOPANI COPPER MINES PLC

NDOLA LIME COMPANY LTD

CHAMBISHI METALS PLC

KANSANSHI MINING PLC

MAAMBA COLLIERIES LIMITED

NLC AFRICA MINING

CNMC LUANSHYA COPPER MINES

LUBAMBE COPPER MINE LTD

ALBIDON LIMITED

COPPERBELT ENERGY CORPORATION

INVESTTRUST BANK ZAMBIA LIMITED

 

 

SUBSIDIARY COMPANIES

 

Copper flash smelting plant, Zambia

Konkola Deep copper-mine project (KDMP)

 

 

Financials

 

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

INR 65.23

UK Pound

1

INR 89.71

Euro

1

INR 79.50

ZMK

1

INR 6.69 

 

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.