MIRA INFORM REPORT

Report Date :

13.12.2013

IDENTIFICATION DETAILS

Name :	S KIJCHAI MDF COMPANY LIMITED
Registered Office :	99/9 Moo 7, T. Huayyang, A. Klang, Rayong 21110
Country :	Thailand
Financials (as on) :	31.12.2012
Date of Incorporation :	28.09.2010
Com. Reg. No.:	0215553003928
Legal Form :	Private Limited Company
Line of Business :	manufacturer, exporter and distributor of Medium Density Fiber Board [MDF boards], with various sizes from 2.5 mm. to 25 mm., under its own brand “S.KIJCHAI”.
No. of Employees :	260

RATING & COMMENTS

MIRA’s Rating :

Ca

RATING		STATUS	PROPOSED CREDIT LINE
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security

Status :	Moderate
Payment Behaviour :	Slow
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 – September 30th, 2013

Country Name	Previous Rating (30.06.2013)	Current Rating (30.09.2013)
Thailand	B1	B1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

THAILAND - ECONOMIC OVERVIEW

With a well-developed infrastructure, a free-enterprise economy, generally pro-investment policies, and strong export industries, Thailand achieved steady growth due largely to industrial and agriculture exports - mostly electronics, agricultural commodities, automobiles and parts, and processed foods. Thailand is trying to maintain growth by encouraging domestic consumption and public investment to offset weak exports in 2012. Unemployment, at less than 1% of the labor force, stands as one of the lowest levels in the world, which puts upward pressure on wages in some industries. Thailand also attracts nearly 2.5 million migrant workers from neighboring countries. The Thai government is implementing a nation-wide 300 baht ($10) per day minimum wage policy and deploying new tax reforms designed to lower rates on middle-income earners. The Thai economy has weathered internal and external economic shocks in recent years. The global economic severely cut Thailand's exports, with most sectors experiencing double-digit drops. In 2009, the economy contracted 2.3%. However, in 2010, Thailand's economy expanded 7.8%, its fastest pace since 1995, as exports rebounded. In late 2011 growth was interrupted by historic flooding in the industrial areas in Bangkok and its five surrounding provinces, crippling the manufacturing sector. Industry recovered from the second quarter of 2012 onward with GDP growth at 5.5% in 2012. The government has approved flood mitigation projects worth $11.7 billion, which were started in 2012, to prevent similar economic damage, and an additional $75 billion for infrastructure over the next seven years with a plan to start in 2013.

Source : CIA

Company name

S KIJCHAI MDF COMPANY LIMITED

SUMMARY

BUSINESS ADDRESS : 99/9 MOO 7, T. HUAYYANG, A. KLANG,

RAYONG 21110, THAILAND

TELEPHONE : [66] 38 928-188

FAX : [66] 38 928-178

E-MAIL ADDRESS : sale_mdf@kijchai.co.th

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 2010

REGISTRATION NO. : 0215553003928

TAX ID NO. : 3034129808

CAPITAL REGISTERED : BHT. 600,000,000

CAPITAL PAID-UP : BHT. 600,000,000

SHAREHOLDER’S PROPORTION : THAI : 100%

FISCAL YEAR CLOSING DATE : DECEMBER 31

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MR. VICHIEN SAENGWONGKIJ, THAI

MANAGING DIRECTOR

NO. OF STAFF : 260

LINES OF BUSINESS : MDF BOARDS

MANUFACTURER, EXPORTER AND DISTRIBUTOR

CORPORATe PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : FAIR WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH LOW PERFORMANCE

HISTORY

The subject was established on September 28, 2010 as a private limited company under the registered name S. KIJCHAI MDF COMPANY LIMITED, by Thai groups, with the business objective to manufacture MDF boards for domestic and export markets. It currently employs approximately 260 staff.

The subject’s registered address is 99/9 Moo 7, T. Huayyang, A. Klang, Rayong 21110, and this is the subject’s current operation address.

THE BOARD OF DIRECTOR

Name	Nationality	Age
Mr. Vichien Saengwongkij	Thai	57

AUTHORIZED PERSON

The above director signs on behalf of the subject with company’s affixed.

MANAGEMENT

Mr. Vichien Saengwongkij is the Managing Director.

He is Thai nationality with the age of 57 years old.

BUSINESS OPERATIONS

The subject is engaged in manufacturing, exporting and distributing Medium Density Fiber Board [MDF boards], with various sizes from 2.5 mm. to 25 mm., under its own brand “S.KIJCHAI”.

PRODUCTION CAPACITY

700 cubic meters per day

PURCHASE

Raw materials are purchased from local suppliers, while machinery for the production is imported from Germany.

SALES

85% of the products is exported to U.S.A., Republic of China, Taiwan, Korea, and the countries in Europe, the remaining 15% is sold locally.

RELATED AND AFFILIATED COMPANIES

S. Kijchai group of companies consists of:

S. Kijchai Wood Panel Co., Ltd.

Business Type : Manufacturer of lumbers

S. Kijchai Concrete Chantaburi Co., Ltd.

Business Type : Distributor of construction equipment

S. Kijchai Co., Ltd.

Business Type : Manufacturer of wooden furniture

LITIGATION

Bankruptcy and Receivership

There are no litigation on bankruptcy and receivership cases filed against the subject found at Legal Execution Department for the past five years.

Others

There are no legal suits filed against the subject for the past two years.

CREDIT

Sales are by cash or on the credits term of 30-60 days.

Local bills are paid by cash or on the credits term of 30-60 days.

Imports are by L/C at sight or T/T.

Exports are against T/T.

BANKING

Bank of Ayudhya Public Co., Ltd.

Bangkok Bank Public Co., Ltd.

EMPLOYMENT

The subject currently employs approximately 260 office staff and factory workers.

LOCATION DETAILS

The premise is owned for administrative office, factory and warehouse at the heading address. Premise is located in provincial.

COMMENT

The subject has been in this business for only few years. Growth is predicted to be at slow pace due to overall economic slowdown including construction sector.

FINANCIAL INFORMATION

The capital was registered at Bht. 600,000,000 divided into 6,000,000 shares of Bht. 100 each with fully paid.

THE SHAREHOLDERS LISTED WERE : [as at April 30, 2013]

NAME	HOLDING	%
Mr. Vichien Saengwongkij Nationality: Thai Address : 4 Moo 3, T. Songsalung, A. Klang, Rayong	1,018,500	16.975
Mr. Vichai Saengwongkij Nationality: Thai Address : 29/3 Moo 7, T. Huayyang, A. Klang, Rayong	1,018,500	16.975
Ms. Sunisa Saengwongkij Nationality: Thai Address : 29/3 Moo 7, T. Huayyang, A. Klang, Rayong	1,018,500	16.975
Mrs. Nattaporn Arayaprakarn Nationality: Thai Address : 284 Moo 2, T. Banklongsuan, A. Phrasamutjaedi, Samutprakarn	1,018,500	16.975
Mr. Somnuek Wongsaengkij Nationality: Thai Address : 199 Moo 3, T. Krasaebon, A. Klang, Rayong	600,000	10.00
Mr. Sanguan Saengwongkij Nationality: Thai Address : 199/3 Moo 3, T. Krasaebon, A. Klang, Rayong	600,000	10.00
Ms. Saengchan saengwongkij Nationality: Thai Address : 5 Moo 2, T. Huayyang, A. Klang, Rayong	600,000	10.00
Mr. Supoj Masayamas Nationality: Thai Address : 77/1 Moo 5, T. Tangjwean, A. Klang, Rayong	126,000	2.10

Total Shareholders : 8

Share Structure [as at April 30, 2013]

Nationality	Shareholders	No. of Share	% Shares
Thai	8	6,000,000	100.00
Foreign	-	-	-
Total	8	6,000,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO. :

Mr. Padej Songrod No. 3020

BALANCE SHEET [BAHT]

The latest financial figures published as at December 31, 2012, 2011 & 2010 were:

ASSETS

Current Assets	2012	2011	2010
Cash and Cash Equivalents	21,488,724.94	233,262,395.66	33,480.50
Trade Accounts & Other Receivable	3,568,161.60	28,883.56	-
Other Current Assets	39,257,976.43	5,346,705.10	301,933.29
Total Current Assets	64,314,862.97	238,637,984.32	335,413.79
Long-term Loans	101,000,000.00	313,000,000.00	144,600,000.00
Fixed Assets	1,653,425,397.04	519,655,342.50	4,774,157.00
Deferred Income Tax	17,970.89	9,144.55	-
Other Non-current Assets	3,301,944.00	3,283,944.00	-
Total Assets	1,822,060,174.90	1,074,586,415.37	149,709,570.79

LIABILITIES & SHAREHOLDERS’ EQUITY [BAHT]

Current Liabilities	2012	2011	2010
Trade Accounts & Other Payable	33,483,441.83	45,073,790.32	-
Current Portion of Long-term Loans	30,000,000.00	-	-
Other Current Liabilities	471,729.58	-	21,096.50
Total Current Liabilities	63,955,171.41	45,073,790.32	21,096.50
Long-term Loan	1,171,621,000.00	430,506,600.00	-
Total Liabilities	1,235,576,171.41	475,580,390.32	21,096.50
Shareholders' Equity
Share capital : Baht 100 par value Authorized & issued share capital 6,000,000 shares	600,000,000.00	600,000,000.00	-
Share capital : Baht 25 par value Authorized & issued share capital 6,000,000 shares	-	-	150,000,000.00
Capital Paid	600,000,000.00	600,000,000.00	150,000,000.00
Retained Earning Unappropriated [Deficit]	[13,515,996.51]	[993,974.95]	[311,525.71]
Total Shareholders' Equity	586,484,003.49	599,006,025.05	149,688,474.29
Total Liabilities & Shareholders' Equity	1,822,060,174.90	1,074,586,415.37	149,709,570.79

PROFIT & LOSS ACCOUNT

Revenue	2012	2011	2010
Sales & Services Income	41,674,007.39	-	-
Other Income	930,581.77	1,939,740.45	3,965.13
Total Revenues	42,604,589.16	1,939,740.45	3,965.13
Expenses
Administrative Expenses	55,126,610.72	2,622,189.69	315,490.84
Total Expenses	55,126,610.72	2,622,189.69	315,490.84
Net Profit / [Loss]	[12,522,021.56]	[682,449.24]	[311,525.71]

FINANCIAL ANALYSIS

ITEM	UNIT	2012	2011	2010
LIQUIDITY RATIO
CURRENT RATIO	TIMES	1.01	5.29	15.90
QUICK RATIO	TIMES	0.39	5.18	1.59
ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	0.03	-	-
TOTAL ASSETS TURNOVER	TIMES	0.02	-	-
INVENTORY CONVERSION PERIOD	DAYS	-	-	-
INVENTORY TURNOVER	TIMES	-	-	-
RECEIVABLES CONVERSION PERIOD	DAYS	31.25	-	-
RECEIVABLES TURNOVER	TIMES	11.68	-	-
PAYABLES CONVERSION PERIOD	DAYS	-	-	-
CASH CONVERSION CYCLE	DAYS	31.25	-	-
PROFITABILITY RATIO
COST OF GOODS SOLD	%	-	-	-
SELLING & ADMINISTRATION	%	132.28	-	-
INTEREST	%	-	-	-
GROSS PROFIT MARGIN	%	102.23	-	-
NET PROFIT MARGIN BEFORE EX. ITEM	%	(30.05)	-	-
NET PROFIT MARGIN	%	(30.05)	-	-
RETURN ON EQUITY	%	(2.14)	(0.11)	(0.21)
RETURN ON ASSET	%	(0.69)	(0.06)	(0.21)
EARNING PER SHARE	BAHT	(2.09)	(0.11)	(0.05)
LEVERAGE RATIO
DEBT RATIO	TIMES	0.68	0.44	0.00
DEBT TO EQUITY RATIO	TIMES	2.11	0.79	0.00
TIME INTEREST EARNED	TIMES	-	-	-
ANNUAL GROWTH
SALES GROWTH	%	-	-
OPERATING PROFIT	%	1,734.86	119.07
NET PROFIT	%	(1,734.86)	(119.07)
FIXED ASSETS	%	218.18	10,784.76
TOTAL ASSETS	%	69.56	617.78

ANNUAL GROWTH : SATISFACTORY

Net profit has decreased from THB -682,449.24 in 2011 to THB -12,522,021.56 in 2012. And total assets has increased from THB 1,074,586,415.37 in 2011 to THB 1,822,060,174.90 in 2012.

PROFITABILITY : ACCEPTABLE

PROFITABILITY RATIO

Gross Profit Margin	102.23	Impressive	Industrial Average	10.59
Net Profit Margin	(30.05)	Deteriorated	Industrial Average	(1.49)
Return on Assets	(0.69)	Deteriorated	Industrial Average	(1.92)
Return on Equity	(2.14)	Deteriorated	Industrial Average	(5.54)

Gross Profit Margin used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. Gross profit margin serves as the source for paying additional expenses and future savings. Gross Profit Margin is 102.23%. When compared with the industry average, the ratio of the company was higher, indicated that company was more profitable than the same industry.

Net Profit Margin is the indicator of the company's efficiency in that net profit takes into consideration all expenses of the company. A low profit margin indicates a low margin of safety, higher risk that a decline in sales will erase profits and result in a net loss. The company's figure is -30.05%. When compared with the industry average, the ratio of the company was lower.

Return on Assets measures how efficiently profits are being generated from the assets employed in the business when compared with the ratios of firms in a similar business. A low ratio in comparison with industry averages indicates an inefficient use of business assets. Return on Assets ratio is -0.69%, higher figure when compared with those of its average competitors in the same industry, indicated that business was an efficient profit in a dominant position within its industry.

Return on Equity indicates how profitable a company is by comparing its net income to its average shareholders' equity, ROE measures how much the shareholders earned for their investment in the company. Return on Equity ratio is -2.14%, higher figure when compared with those of its average competitors in the same industry, indicated that business was an efficient profit in a dominant position within its industry.

Trend of the average competitors in the same industry for last 5 years

Return on Assets Downtrend

Return on Equity Downtrend

LIQUIDITY : ACCEPTABLE

LIQUIDITY RATIO

Current Ratio	1.01	Satisfactory	Industrial Average	1.04
Quick Ratio	0.39
Cash Conversion Cycle	31.25

The Current Ratio is to ascertain whether a company's short-term assets are readily available to pay off its short-term liabilities. The company's figure is 1.01 times in 2012, decrease from 5.29 times, then it is generally considered to have good short-term financial strength. When compared with the industry average, the ratio of the company was lower.

The Quick Ratio is a liquidity indicator that further refines the current ratio by measuring the amount of the most liquid current assets there are to cover current liabilities. The company's figure is 0.39 times in 2012, decrease from 5.18 times, then the company has not enough current assets that presumably can be quickly converted to cash for pay financial obligations.

The Cash Conversion Cycle measures the number of days a company's cash is tied up in the production and sales process of its operations and the benefit from payment terms from its creditors. It meant the company could survive when no cash inflow was received from sale for 32 days.

Trend of the average competitors in the same industry for last 5 years

Current Ratio Downtrend

LEVERAGE : RISKY

LEVERAGE RATIO

Debt Ratio	0.68	Acceptable	Industrial Average	0.65
Debt to Equity Ratio	2.11	Risky	Industrial Average	1.86
Times Interest Earned	-		Industrial Average	-

Debt to Equity Ratio a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. A lower the percentage means that the company is using less leverage and has a stronger equity position.

Debt Ratio shows the proportion of a company's assets which are financed through debt. The company's figure is 0.68 greater than 0.5, most of the company's assets are financed through debt.

Trend of the average competitors in the same industry for last 5 years

Debt Ratio Downtrend

Times Interest Earned Downtrend

ACTIVITY : SATISFACTORY

ACTIVITY RATIO

Fixed Assets Turnover	0.03	Impressive	Industrial Average	-
Total Assets Turnover	0.02	Deteriorated	Industrial Average	1.29
Inventory Conversion Period	-
Inventory Turnover	-		Industrial Average	4.58
Receivables Conversion Period	31.25
Receivables Turnover	11.68	Impressive	Industrial Average	1.97
Payables Conversion Period	-

The company's Account Receivable Ratio is calculated as 11.68 and 0.00 in 2012 and 2011 respectively. This ratio measures the efficiency of the company in managing its trade debtors to generate revenue. A lower ratio may indicate over extension and collection problems. Conversely, a higher ratio may indicate an overtly stringent policy. In this case, the company's A/R ratio in 2012 increased from 2011. This would suggest the company had good performance in the management of its debt collections.

The company's Total Asset Turnover is calculated as 0.02 times and 0 times in 2012 and 2011 respectively. This ratio is determined by dividing total assets into total sales turnover. The ratio measures the activity of the assets and the ability of the firm to generate sales through the use of the assets.

Trend of the average competitors in the same industry for last 5 years

Fixed Assets Turnover Downtrend

Total Assets Turnover Downtrend

Inventory Turnover Downtrend

Receivables Turnover Downtrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.61.62
UK Pound	1	Rs.100.84
Euro	1	Rs.84.98

INFORMATION DETAILS

Report Prepared by :

MNL

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

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 and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

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