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MIRA INFORM REPORT
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Report No. : |
508653 |
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Report Date : |
10.05.2018 |
IDENTIFICATION DETAILS
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Name : |
SUMITOMO CORPORATION |
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Registered Office : |
Office Tower Y Harumi Island Triton Square, 1-8-11 Harumi Chuoku, Tokyo 104-8610 |
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Country : |
Japan |
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Financials (as on) : |
31.03.2017 |
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Date of Incorporation : |
Dec., 1919 |
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Com. Reg. No.: |
0100-01-008692 (Tokyo-Chuoku) |
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Legal Form : |
Limited Company (Kabushiki Kaisha) |
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Line of Business : |
General trading house of metals, industrial machinery, energy & chemicals, other |
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No. of Employees : |
5,162 |
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+ |
Low Risk |
Business dealings permissible with low
risk of default |
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Maximum Credit Limits : |
Yen 86,043.7 Million |
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Status : |
Good |
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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 2016 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 second country to ratify the TPP in December 2016; the United States signaled its withdrawal from the TPP on January 23, 2017, and as of April 2017 the agreement has not gone into effect.
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Source
: CIA |
Company
Name and address
SUMITOMO CORPORATION
REGD NAME: Sumitomo
Shoji KK
MAIN OFFICE: Office
Tower Y Harumi Island Triton Square, 1-8-11 Harumi Chuoku Tokyo 104-8610 JAPAN
Tel:
03-5166-5000 Fax: 03-5166-6296
URL: http://www.sumitomocorp.co.jp/
E-Mail address: ir@sumitomocorp.co.jp
(Investor Relations Division)
ACTIVITIES
General trading
house of metals, industrial machinery, energy & chemicals, other
BRANCHES
Osaka, Nagoya,
other (Tot 13 domestic); 109 overseas in 66 countries
CHIEF
EXEC
KUNIHARU NAKAMURA,
PRES
Yen Amount: In million Yen, unless otherwise stated
SUMMARY
FINANCES FAIR A/SALES Yen 3,966,974 M
PAYMENTS REGULAR CAPITAL Yen 219,279 M
TREND STEADY WORTH Yen
2,366,485 M
STARTED 1919 EMPLOYES 5,162
COMMENT
LEADING GENERAL
TRADING HOUSE, NUCLEUS OF SUMITOMO GROUP FIRMS.
FINANCIAL SITUATION CONSIDERED FAIR AND GOOD
FOR ORDINARY BUSINESSENGAGEMENTS.
MAX CREDIT LIMIT:
YEN 86,043.7 MILLION, 30 DAYS NORMAL TERMS.
HIGHLIGHTS
This is a
fourth-ranked comprehensive
trading house. Began in the smokestack industry, including steel & machinery. Has strength in steel, particularly oil
pipes, where it has close ties with Nippon Steel & Sumitomo Metal Corp. Known for the absence of earnings reliance
on anyone business, including transport machinery, construction machinery, and
the chemicals, resource and
energy businesses. Scale of interests in the resource & energy business is relatively
smaller than the top-ranked trading firms such as Mitsubishi Corp & Mitsui
& Co., but group firms include leading companies in the media &
IT-related business, such as the CATV firm, Jupiter Telecommunications, the TV
sales firm, Jupiter Shop Channel, and the systems development firm, SCSK. A
share exchange with Sumisho Specialty Steel Co is scheduled, and then the
company will make it a wholly
owned subsidiary. The firm is reported won contract for substation (500 KV/230 KV GIS)
from EGAT in Thailand.
FINANCIAL
INFORMATION
The sales volume
for Mar/2017 fiscal term amounted to Yen 3,966,974 million, a 1% fall from Yen
4,010,808 million in the
previous term. The recurring profit was posted at Yen 213,101 million and the net
profit at Yen 170,889 million, respectively, compared with Yen 140,116 million
recurring loss and Yen 74,546 million net losses, respectively, a year ago.
For the current
term ending Mar 2018 the recurring profit is projected at Yen 270,000 million
and the net profit at Yen 230,000 million, respectively, on an 8% rise in
turnover, to Yen 4,300,000 million.
The financial
situation is considered FAIR and good for ORDINARY business engagements. Max credit limit is estimated at Yen
86,043.7 million, on 30 days normal terms.
REGISTRATION
Date
Registered: Dec 1919
Regd
No.:
0100-01-008692
(Tokyo-Chuoku)
Legal
Status: Limited Company (Kabushiki Kaisha)
Authorized: 2,000 million
shares
Issued: 1,250,602,867 shares
Sum:
Yen 219,279 million
Major shareholders
(%): Master Trust Bank of Japan T (6.0), Japan Trustee Services T (4.7),
Liberty Programming Japan (3.6), JP Morgan Chase Bank 385632 (3.2), Sumitomo
Life Ins (2.4), Mitsui Sumitomo Ins (1.6), Barclays Securities Japan (1.5),
1apan Trustee Services T9 (1.4), Dai-ichi Life Ins (1.2), Japan Trustee
Services T7 (1.2); foreign owners (33.2)
No. of
shareholders: 151,953
Listed
on the S/Exchange (s) of: Tokyo, Nagoya & Fukuoka
Managements: Kazuo Ohmori,
ch; Kuniharu Nakamura, pres; Naoki Hidaka, v pres; Hideki Iwasawa, v pres;
Masahiro Fujita, s/mgn dir; Koichi Takahata, s/mgn dir; Masao Tabuchi, mgn dir;
Hirohiko Imura, mgn dir; Makoto Horie, mgn dir; Masayuki Hyodo, mgn dir
Nothing detrimental is known as to the
commercial morality of executives.
Related
companies: Sumitomo Auto Lease, Sumisho Computer Systems, Sumisho Electronics,
Sumitomo USA Inc, other
OPERATION
Activities: General trading
house for import, export and wholesale of: metals & products (100%)
Overseas
Trading Ratio (60%) (about)
Clients: [Mfrs,
wholesalers] Sumitomo Communication Global Commodities Ltd, Nippon Steel &
Sumitomo Metal Corp, Sumitomo Metal Mining, Sumisho Materials Corp, Mitsubishi
Materials, Chung Hung Steel, PT Hino Motors Manufacturing Indonesia, Idemitsu
Kosan Kaisha, Kansai Electric Power, Sumitomo Chemical, other.
No. of accounts: 3,000
Domestic areas of activities: Nationwide
Suppliers: [Mfrs,
wholesalers] Sumitomo Communication Global Commodities Ltd, Nippon Steel &
Sumitomo Metal Corp, Sumisho Materials Corp, Sumitomo Metal Mining, Oshima
Shipbuilding Co, Petro Summit Pte Ltd, Hino Motors, Idemitsu Kosan Kaisha,
Mitsubishi Material, TonenGeneral Sekiyu, Toshiba Corp, other.
Payment
record: Regular
Location: Business area in Tokyo. Office premises at the caption address are leased
and maintained satisfactorily.
Bank References:
SMBC
(Tokyo)
MUFG
(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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4,300,000 |
3,966,974 |
4,010,808 |
3,762,236 |
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Recur.
Profit |
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270,000 |
213,101 |
140,116 |
-18,561 |
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Net
Profit |
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230,000 |
170,889 |
74,546 |
-73,170 |
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Total
Assets |
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7,761,794 |
7,817,818 |
9,021,370 |
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Current
Assets |
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3,321,175 |
3,387,072 |
3,948,684 |
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Current
Liabs |
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2,175,919 |
2,120,119 |
2,479,620 |
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Net
Worth |
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2,366,485 |
2,251,509 |
2,481,432 |
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Capital,
Paid-Up |
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219,279 |
219,279 |
219,279 |
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Div.Ttl
in Million (¥) |
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62,406 |
62,396 |
61,135 |
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<Analytical Data> |
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(%) |
(%) |
(%) |
(%) |
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S.Growth Rate |
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8.39 |
-1.09 |
6.61 |
13.41 |
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Current Ratio |
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.. |
152.63 |
159.76 |
159.25 |
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N.Worth Ratio |
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.. |
30.49 |
28.80 |
27.51 |
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R.Profit/Sales |
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6.28 |
5.37 |
3.49 |
-0.49 |
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N.Profit/Sales |
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5.35 |
4.31 |
1.86 |
-1.94 |
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Return On Equity |
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.. |
7.22 |
3.31 |
-2.95 |
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 67.38 |
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1 |
INR 91.09 |
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Euro |
1 |
INR 79.75 |
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Yen |
1 |
INR 0.61 |
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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NIY |
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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.