MIRA INFORM REPORT

 

 

Report Date :

31.10.2013

 

IDENTIFICATION DETAILS

 

Name :

MIP TECHNOLOGY SDN. BHD.

 

 

Formerly Known As :

SYSNOTECH (M) SDN BHD (01/08/1997)

 

DILIGENT FRONTIER SDN BHD (31/12/1996)

 

 

Registered Office :

32A-2, Jalan Kuchai Maju 8, Off Jalan Kuchai Lama, 58200 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2011

 

 

Date of Incorporation :

05.12.1996

 

 

Com. Reg. No.:

412526-V

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Trading of Hardwares and Hand Tools.

 

 

No. of Employees :

10

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

 

 

Payment Behaviour :

Unknown

 

 

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 – March 31st, 2013

 

Country Name

Previous Rating

(31.12.2012)

Current Rating

(31.03.2013)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

 

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

 

 

 

 

 

 

MALAYSIA - ECONOMIC OVERVIEW

 

Malaysia, a middle-income country, has transformed itself since the 1970s from a producer of raw materials into an emerging multi-sector economy. Under current Prime Minister NAJIB, Malaysia is attempting to achieve high-income status by 2020 and to move farther up the value-added production chain by attracting investments in Islamic finance, high technology industries, biotechnology, and services. NAJIB's Economic Transformation Program (ETP) is a series of projects and policy measures intended to accelerate the country's economic growth. The government has also taken steps to liberalize some services sub-sectors. The NAJIB administration also is continuing efforts to boost domestic demand and reduce the economy''s dependence on exports. Nevertheless, exports - particularly of electronics, oil and gas, palm oil and rubber - remain a significant driver of the economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the rising cost of domestic gasoline and diesel fuel, combined with strained government finances, has forced Kuala Lumpur to begin to reduce government subsidies. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies about 35% of government revenue in 2011. Bank Negera Malaysia (central bank) maintains healthy foreign exchange reserves, and a well-developed regulatory regime has limited Malaysia''s exposure to riskier financial instruments and the global financial crisis. Nevertheless, Malaysia could be vulnerable to a fall in commodity prices or a general slowdown in global economic activity because exports are a major component of GDP. In order to attract increased investment, NAJIB has raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but he has encountered significant opposition, especially from Malay nationalists and other vested interests.

 

Source : CIA

 

* Adopted abbreviations :

SC - Subject Company (the company enquired by you)

 

 

N/A - Not Applicable

 

 

Executive Summary

 

REGISTRATION NO.

:

412526-V

COMPANY NAME

:

MIP TECHNOLOGY SDN. BHD.

FORMER NAME

:

SYSNOTECH (M) SDN BHD (01/08/1997)
DILIGENT FRONTIER SDN BHD (31/12/1996)

INCORPORATION DATE

:

05/12/1996

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

32A-2, JALAN KUCHAI MAJU 8, OFF JALAN KUCHAI LAMA, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

20, JALAN 14/155, BUKIT JALIL INTEGRATED BUSINESS PARK, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

:

03-77814416

FAX.NO.

:

03-77824416

CONTACT PERSON

:

SU WEI FENG ( DIRECTOR )

 

 

 

INDUSTRY CODE

:

47520

PRINCIPAL ACTIVITY

:

TRADING OF HARDWARES AND HAND TOOLS

AUTHORISED CAPITAL

:

MYR 500,000.00 DIVIDED INTO 
ORDINARY SHARE 500,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 100,000.00 DIVIDED INTO 
ORDINARY SHARES 100,000 CASH OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 2,182,892 [2011]

NET WORTH

:

MYR 184,770 [2011]

 

 

 

STAFF STRENGTH

:

10 [2013]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

POOR

MANAGEMENT CAPABILITY

:

AVERAGE

 

 

 

COMMERCIAL RISK

:

HIGH

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

SATISFACTORY

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 

 

History/ Background

 

The SC is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the SC must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the SC is capable of owning assets, entering into contracts, sue or be sued by other companies. The liabilities of the shareholders are to the extent of the equity they have taken up and the creditors cannot claim on shareholders' personal assets even if the SC is insolvent. The SC is governed by the Companies Act, 1965 and the company must file its annual returns, together with its financial statements with the Registrar of Companies.

 

The SC is principally engaged in the (as a / as an) trading of hardwares and hand tools.

 

The SC is not listed on Bursa Malaysia (Malaysia Stock Exchange).

 

The major shareholder(s) of the SC are shown as follows :

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

MR. KOK CHIN SIANG +

18, PERSIARAN 155A, BUKIT OUG TOWNHOUSE, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

681021-13-5753 K0164747

99,999.00

100.00

MS. SU WEI FENG +

18, PERSIARAN 155A, BUKIT OUG TOWNHOUSE, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

720408-07-5184 A2159087

1.00

0.00

 

 

 

---------------

------

 

 

 

100,000.00

100.00

 

 

 

============

=====

+ Also Director

 

 

Directors

 

DIRECTOR 1

 

Name Of Subject

:

MS. SU WEI FENG

Address

:

18, PERSIARAN 155A, BUKIT OUG TOWNHOUSE, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A2159087

New IC No

:

720408-07-5184

Date of Birth

:

08/04/1972

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

02/02/2000

 

 

 

 

 

 

 

 

 

 

 

 



DIRECTOR 2

 

Name Of Subject

:

MR. KOK CHIN SIANG

Address

:

18, PERSIARAN 155A, BUKIT OUG TOWNHOUSE, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

K0164747

New IC No

:

681021-13-5753

Date of Birth

:

21/10/1968

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

11/11/1997

 

 

Management

 

1)

Name of Subject

:

SU WEI FENG

 

Position

:

DIRECTOR

 

 

Auditor

 

Auditor

:

OK YAU & HOWYONG

Auditor' Address

:

38D-2, JALAN RADIN ANUM, BANDAR BARU, SERI PETALING, 57000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

Company secretaries

 

1)

Company Secretary

:

MS. ANGELA KHAW ENG CHOO

 

 

 

 

 

New IC No

:

721021-07-5432

 

Address

:

NO.2, JALAN DAMAI PERDANA 1/4, BANDAR DAMAI PERDANA, CHERAS, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MS. WONG LEE CHING

 

 

 

 

 

New IC No

:

720922-06-5130

 

Address

:

8653, TAMAN RAYA, 28300 TRIANG, PAHANG, MALAYSIA.

 

 

Banking

 

Banking relations are maintained principally with:

 

1)

Name

:

MALAYAN BANKING BHD

 

 

Encumbrance(s)

 

No encumbrance was found in our databank at the time of investigation. 

 

 

Legal Check Against SC

 

* A check has been conducted in our databank againt the SC whether the subject has been involved in any litigation. Our databank consists of 99% of the wound up companies in Malaysia.


No legal action was found in our databank. 


No winding up petition was found in our databank. 

 

 

Defaulter Check Against SC

 

* We have checked through the SC in our defaulters' database which comprised of debtors that have been blacklisted by our customers and debtors that have been placed or assigned to us for collection since 1990. Information was provided by third party where the debt amount can be disputed. Please check with creditors for confirmation as alleged debts may have been paid since recorded or are being disputed. 


No blacklisted record & debt collection case was found in our defaulters' databank. 

 

 

Payment record

 

SOURCES OF RAW MATERIALS:

Local

:

YES

Overseas

:

YES

Import Countries

:

JAPAN,CHINA,INDIA,KOREA



The SC refused to provide any name of trade/service supplier and we are unable to conduct any trade enquiry. However, from financial historical data we conclude that :

 

OVERALL PAYMENT HABIT

Prompt 0-30 Days

[

 

]

 

Good 31-60 Days

[

 

]

 

Average 61-90 Days

[

 

]

 

Fair 91-120 Days

[

 

]

 

Poor >120 Days

[

X

]

 

 

 

 

 

 

 

 

Clientele

 

Local

:

YES

Percentage

:

100%

Domestic Markets

:

MALAYSIA

Overseas

:

NO

 

 

 

 

 

 

 

 

 

Credit Term

:

AS AGREED

 

 

 

 

 

 

Payment Mode

:

CASH
CHEQUES

 

 

Operations

 

Goods Traded

:

HARDWARE PRODUCTS

 

 

 

 

Member(s) / Affiliate(s)

:

SMI ASSOCIATION OF MALAYSIA

 

 

 

 

Total Number of Employees:

YEAR

2013

2011

 

 

GROUP

N/A

N/A

 

 

 

 

 

 

 

COMPANY

10

10

 

 

 

 

 

 

 

 

Branch

:

NO

 

 

Other Information:


The SC is principally engaged in the (as a / as an) trading of hardwares and hand tools. 

The SC sells a wire range of hardwares includes hammers, screw drivers, screws, spanners, pad-locks and others.

Besides that the SC has a warehouse located at the same premises to keep stocks and materials.

According to the SC, it also provides products based on the customers' requirements 

 

 

Current Investigation

 

Latest fresh investigations carried out on the SC indicated that :

 

Telephone Number Provided By Client

:

0377814416

Current Telephone Number

:

03-77814416

Match

:

YES

 

 

 

Address Provided by Client

:

20 JALAN 14/155 BUKIT OUG INTEGRATED BUSINESS PARK 58200, KUALA LUMPUR

Current Address

:

20, JALAN 14/155, BUKIT JALIL INTEGRATED BUSINESS PARK, 58200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Match

:

NO

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


We contacted one of the staff from the Finance Department. She provided some information on the SC.

The address provided also belongs to the SC.

 

 

Financial Analysis

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2007 - 2011

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2007 - 2011

]

 

Return on Shareholder Funds

:

Unfavourable

[

<58.53%>

]

 

Return on Net Assets

:

Unfavourable

[

<49.37%>

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.The SC incurred losses during the year due to the inefficient control of its operating costs. The SC's unfavourable returns on shareholders' funds indicate the management's inefficiency in utilising its assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Unfavourable

[

234 Days

]

 

Debtor Ratio

:

Unfavourable

[

95 Days

]

 

Creditors Ratio

:

Unfavourable

[

166 Days

]

 

 

 

 

 

 

 

 

The SC could be incurring higher holding cost. As its capital was tied up in stocks, it could face liquidity problems. The SC's debtors ratio was high. The SC should tighten its credit control and improve its collection period. The unfavourable creditors' ratio could be due to the SC taking advantage of the credit granted by its suppliers. However this may affect the goodwill between the SC and its suppliers and the SC may inadvertently have to pay more for its future supplies.

 

 

 

 

 

 

 

Liquidity

 

 

 

 

 

 

Liquid Ratio

:

Unfavourable

[

0.39 Times

]

 

Current Ratio

:

Unfavourable

[

1.05 Times

]

 

 

 

 

 

 

 

 

A low liquid ratio means that the SC may be facing working capital deficiency. If the SC cannot obtain additional financing or injection of fresh capital, it may face difficulties in meeting its short term obligations.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Unfavourable

[

<38.31 Times>

]

 

Gearing Ratio

:

Favourable

[

0.14 Times

]

 

 

 

 

 

 

 

 

The SC incurred losses in the year. It did not generate sufficient income to service its interest. If the situation does not improve, the SC may be vulnerable to default in servicing the interest. The SC was lowly geared thus it had a low financial risk. The SC was mainly financed by its shareholders' funds and internally generated funds. In times of economic slowdown / downturn, the SC being a lowly geared company, will be able to compete better than those companies which are highly geared in the same industry.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

The SC's losses increased but its turnover showed a fluctuating trend. This indicate the SC was slowly losing its market share due to its competitors. Due to its weak liquidity position, the SC will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the SC. The SC's interest cover was negative, indicating that it did not generate sufficient income to service its interest. If its result does not show impressive improvements or succeed obtaining short term financing or capital injection, it may not be able to service its interest and repay the loans. The SC as a lowly geared company, will be more secured compared to those highly geared companies. It has the ability to meet all its long term obligations.

 

 

 

 

 

 

 

Overall financial condition of the SC : POOR

 

 

Malaysia Economic/ Industry Outlook

 

Major Economic Indicators:

2009

2010

2011

2012*

2013**

 

 

 

 

 

 

Population ( Million)

28.13

28.35

28.70

29.30

29.80

Gross Domestic Products ( % )

<0.5>

7.2

5.1

5.6

5.3

Domestic Demand ( % )

2.9

6.3

8.2

9.4

5.6

Private Expenditure ( % )

<2.7>

8.1

8.2

8.0

7.4

Consumption ( % )

0.7

6.7

7.1

1.0

5.7

Investment ( % )

<17.2>

17.7

12.2

11.7

13.3

Public Expenditure ( % )

5.2

3.8

8.4

13.3

1.2

Consumption ( % )

3.1

0.2

16.1

11.3

<1.2>

Investment ( % )

8.0

2.8

<0.3>

15.9

4.2

 

 

 

 

 

 

Balance of Trade ( MYR Million )

89,650

118,356

116,058

106,300

110,700

Government Finance ( MYR Million )

<28,450>

<40,482>

<45,511>

<42,297>

<39,993>

Government Finance to GDP / Fiscal Deficit ( % )

<4.8>

<5.6>

<5.4>

<4.5>

<4.0>

Inflation ( % Change in Composite CPI)

<5.2>

5.1

3.1

1.6

2.5

Unemployment Rate

4.5

3.9

3.3

3.2

3.0

 

 

 

 

 

 

Net International Reserves ( MYR Billion )

331

329

415

427

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

2.87

2.20

3.50

2.20

-

Average 3 Months of Non-performing Loans ( % )

11.08

15.30

14.80

14.70

-

Average Base Lending Rate ( % )

5.53

6.30

6.60

6.53

-

Business Loans Disbursed( % )

10.5

14.7

15.3

32.2

-

Foreign Investment ( MYR Million )

22,156.8

22,517.9

23,546.1

26,230.4

-

Consumer Loans ( % )

-

-

-

-

-

 

 

 

 

 

 

Registration of New Companies ( No. )

41,578

44,148

45,455

45,441

-

Registration of New Companies ( % )

<0.1>

6.2

3.0

<0.0>

-

Liquidation of Companies ( No. )

39,075

25,585

132,476

-

-

Liquidation of Companies ( % )

39.6

<34.5>

417.8

-

-

 

 

 

 

 

 

Registration of New Business ( No. )

312,581

271,414

284,598

324,761

-

Registration of New Business ( % )

-

-

-

-

-

Business Dissolved ( No. )

19,345

19,738

20,121

-

-

Business Dissolved ( % )

2.4

2.0

1.9

-

-

 

 

 

 

 

 

Sales of New Passenger Cars (' 000 Unit )

486.3

543.6

535.1

552.2

-

Cellular Phone Subscribers ( Million )

30.1

32.8

35.3

38.5

-

Tourist Arrival ( Million Persons )

23.6

24.6

24.7

25.0

-

Hotel Occupancy Rate ( % )

58.0

63.0

60.6

62.4

-

 

 

 

 

 

 

Credit Cards Spending ( % )

12.8

14.1

15.6

12.6

-

Bad Cheque Offenders (No.)

36,667

33,568

32,627

26,982

-

Individual Bankruptcy ( No.)

16,228

18,119

19,167

19,575

-

Individual Bankruptcy ( % )

16.7

11.7

5.8

2.1

-



INDUSTRIES ( % of Growth ):

2009

2010

2011

2012*

2013**

 

 

 

 

 

 

Agriculture

0.4

2.1

5.9

0.6

2.4

Palm Oil

<1.1>

<3.4>

10.8

<2.8>

-

Rubber

<19.8>

9.9

6.1

<0.6>

-

Forestry & Logging

<5.9>

<3.3>

<7.6>

<2.2>

-

Fishing

5.5

5.6

2.1

<0.7>

-

Other Agriculture

9.0

7.9

7.1

6.4

-

Industry Non-Performing Loans ( MYR Million )

413.7

508.4

634.1

-

-

% of Industry Non-Performing Loans

1.3

2.1

3.2

-

-

 

 

 

 

 

 

Mining

<3.8>

0.2

<5.7>

1.5

2.7

Oil & Gas

2.1

0.5

<1.7>

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

44.2

49.7

46.5

-

-

% of Industry Non-performing Loans

0.1

0.1

0.1

-

-

 

 

 

 

 

 

Manufacturing #

<9.4>

11.4

4.7

4.2

4.9

Exported-oriented Industries

<19.0>

12.1

2.8

4.1

-

Electrical & Electronics

<30.3>

28.4

<4.9>

1.6

-

Rubber Products

<10.1>

25.3

15.4

3.6

-

Wood Products

<24.1>

20.1

<4.9>

4.6

-

Textiles & Apparel

<19.5>

<0.4>

14.8

<7.1>

-

Domestic-oriented Industries

<9.8>

16.3

6.5

8.6

-

Food, Beverages & Tobacco

0.2

3.0

4.2

-

-

Chemical & Chemical Products

<7.7>

16.2

5.5

9.9

-

Plastic Products

<9.1>

2.4

3.8

-

-

Iron & Steel

<32.7>

29.3

2.4

-

-

Fabricated Metal Products

<2.5>

14.9

25.2

-

-

Non-metallic Mineral

<15.5>

20.2

27.1

6.6

-

Transport Equipment

<13.5>

36.5

<10.4>

13.7

-

Paper & Paper Products

<5.0>

18.7

14.8

<7.8>

-

Crude Oil Refineries

0.2

<11.4>

9.3

-

-

Industry Non-Performing Loans ( MYR Million )

6,007.3

6,217.5

6,537.2

-

-

% of Industry Non-Performing Loans

18.3

23.8

25.7

-

-

 

 

 

 

 

 

Construction

5.8

5.1

4.4

15.5

11.2

Industry Non-Performing Loans ( MYR Million )

3,241.8

4,038.5

3,856.9

-

-

% of Industry Non-Performing Loans

9.9

10.7

10.2

-

-

 

 

 

 

 

 

Services

2.6

6.5

6.4

5.5

5.6

Electric, Gas & Water

0.4

8.5

5.6

4.8

-

Transport, Storage & Communication

1.6

7.7

6.5

7.3

-

Wholesale, Retail, Hotel & Restaurant

2.8

4.7

5.2

6.9

-

Finance, Insurance & Real Estate

3.8

6.1

6.3

6.5

-

Government Services

2.0

6.7

7.6

5.6

-

Other Services

4.4

4.2

5.4

5.7

-

Industry Non-Performing Loans ( MYR Million )

6,631.3

7,384.6

6,825.2

-

-

% of Industry Non-Performing Loans

20.2

25.7

23.4

-

-

 

 

 

 

 

 

 

 

 

 

 

 

* Estimate / Preliminary

 

 

 

 

 

** Forecast

 

 

 

 

 

# Based On Manufacturing Production Index 

 

 

Industry Analysis 

 

MSIC CODE

 

47520 : Retail sale of construction materials, hardware, paints and glass

 

 

INDUSTRY :

TRADING

 

 

 

According to the Retail Group Malaysia (RGM), the wholesale and retail trade sector forecast to grow to 6% in year 2013. During the first quarter of year 2013, RGM is estimating the retail industry to grow 6.9%. Many retailers have been enjoying better sales since the government handed out cash from mid-January of 2013 under the second round of Bantuan Rakyat 1Malaysia to more than 12 million Malaysians. Bookstores and related retail stores have also started enjoying rising sales since the RM250 1Malaysia Book Voucher was distributed to 1.3 million private and public university students. Besides, since early February 2013, handphone traders and retailers selling smartphone accessories have started to benefit from the RM200 rebate on smartphones for 1.5 million young adults aged between 21 and 30 years with a monthly income of not more than RM3,000.

 

The wholesale and retail trade sector grew 6.1% in the first half of the year 2012 driven by strong domestic consumption and the increasing number of large format stores operating in Malaysia, including 180 foreign hypermarkets, superstores and departmental stores as at end of August 2012. In addition, other indicators such as imports of consumption goods were higher by 15.2%.

 

In 2012, the wholesale and retail trade sector growth to 5.5% driven by higher consumption which benefited from Government initiatives under the 2012 Budget such as BR1M, Baucar Buku 1Malaysia (BB1M) and the RM100 assistance for all primary and secondary school students. The performance of the sector will also be supported by ongoing efforts to modernise the retail segment under the ETP. In 2012, 500 retail shops and 50 workshops are targeted to be modernised under the Retail Shop Transformation (TUKAR) and Automotive Workshop Modernisation (ATOM) programmes, respectively. As at end of July 2012, 95 workshops have been modernised, surpassing the yearly target, while 393 retail shops have been modernised.

 

Growth of the sector is anticipated to remain encouraging with ongoing efforts by the Government to increase its contribution to the economy. Major initiatives include increasing the number of large format stores such as hypermarkets, superstores and departmental stores are carried out to boost the economy.

 

Over 60% of Gross Domestic Product (GDP) is contributed by domestic consumption, therefore the wholesale and retail sector plays a crucial role in driving Malaysia's growth over the next decade despite the ongoing global economic slowdown. By 2020, Malaysia's wholesale and retail sector is expected to boost the country's total Gross National Income (GNI) by RM156 billion, creating 454,190 new jobs.

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth

 

 

Credit Risk Evaluation & Recommendation

 

Incorporated in 1996, the SC is a Private Limited company, focusing on trading of hardwares and hand tools. Having been in the industry for over a decade, the SC has achieved a certain market share and has built up a satisfactory reputation in the market. It should have received supports from its regular customers. However, with a small capital, the SC should put more efforts on its business to gain higher market share while competing aggressively in the market. 


Investigation revealed that the SC concentrates only on the local market. This narrow market segment has placed the SC at high business risk and limits its business expansion opportunities. Any adverse changes to the local economy might have a negative impact on the SC's business performance. Being a small company, the SC's business operation is supported by 10 employees. Overall, we regard that the SC's management capability is average. 

Due to the challenging market conditions, the SC's business performance seems to be deteriorating and losses incurred. The SC has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. Due to its weak liquidity position, the SC may face working capital deficiency in meeting its short term financial obligations if no fresh capital are injected into the SC. Being a lowly geared company, the SC is exposed to low financial risk as it is mainly dependent on its internal funds to finance its business needs. 


The SC's supplier are from both the local and overseas countries. This will eliminates the risk of dependency on deliveries from a number of key suppliers and insufficient quantities of its raw materials. 


The poor payment habit may affect the goodwill between the SC and its suppliers and the SC may inadvertently have to pay more for its future supplies. 


The industry shows an upward trend and this trend is very likely to sustain in the near terms. Hence, the SC is expected to benefit from the favourable outlook of the industry. 


In view of the above, we recommend credit be granted to the SC with close monitoring.

 

 

PROFIT AND LOSS ACCOUNT

 

HE FINANCIAL STATEMENTS WERE PREPARED IN ACCORDANCE WITH MALAYSIAN FINANCIAL REPORTING STANDARDS(FRS)

MIP TECHNOLOGY SDN. BHD.

 

Financial Year End

2011-12-31

2010-12-31

2009-12-31

2008-12-31

2007-12-31

Months

12

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Company

Audited Account

YES

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

YES

Financial Type

FULL

FULL

SUMMARY

SUMMARY

SUMMARY

Currency

MYR

MYR

MYR

MYR

MYR

 

 

 

 

 

 

TURNOVER

2,182,892

4,857,238

4,528,163

4,224,040

3,771,996

 

----------------

----------------

----------------

----------------

----------------

Total Turnover

2,182,892

4,857,238

4,528,163

4,224,040

3,771,996

Costs of Goods Sold

<1,718,025>

<4,245,182>

-

-

-

 

----------------

----------------

----------------

----------------

----------------

Gross Profit

464,867

612,056

-

-

-

 

----------------

----------------

----------------

----------------

----------------

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

<107,985>

70,853

103,225

22,009

13,398

 

----------------

----------------

----------------

----------------

----------------

PROFIT/(LOSS) BEFORE TAXATION

<107,985>

70,853

103,225

22,009

13,398

Taxation

<164>

<16,600>

<19,107>

-

-

 

----------------

----------------

----------------

----------------

----------------

PROFIT/(LOSS) AFTER TAXATION

<108,149>

54,253

84,118

22,009

13,398

 

----------------

----------------

----------------

----------------

----------------

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

192,919

138,666

54,548

32,539

19,141

 

----------------

----------------

----------------

----------------

----------------

As restated

192,919

138,666

54,548

32,539

19,141

 

----------------

----------------

----------------

----------------

----------------

PROFIT AVAILABLE FOR APPROPRIATIONS

84,770

192,919

138,666

54,548

32,539

 

----------------

----------------

----------------

----------------

----------------

RETAINED PROFIT/(LOSS) CARRIED FORWARD

84,770

192,919

138,666

54,548

32,539

 

=============

=============

=============

=============

=============

 

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

 

Hire purchase

2,747

1,881

-

-

-

 

----------------

----------------

 

 

 

 

2,747

1,881

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE SHEET

 

 

MIP TECHNOLOGY SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

115,085

152,166

145,124

152,116

96,373

 

 

 

 

 

 

LONG TERM INVESTMENTS/OTHER ASSETS

 

 

 

 

 

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

-

-

0

-

-

 

 

 

 

 

 

 

----------------

----------------

----------------

----------------

----------------

TOTAL LONG TERM ASSETS

115,085

152,166

145,124

152,116

96,373

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

Stocks

1,396,846

680,054

-

-

-

Trade debtors

570,479

1,451,995

-

-

-

Other debtors, deposits & prepayments

139,589

139,589

-

-

-

Cash & bank balances

36,263

197,055

-

-

-

Others

98,553

72,342

-

-

-

 

----------------

----------------

----------------

----------------

----------------

TOTAL CURRENT ASSETS

2,241,730

2,541,035

2,252,348

1,773,711

1,836,470

 

----------------

----------------

----------------

----------------

----------------

TOTAL ASSET

2,356,815

2,693,201

2,397,472

1,925,827

1,932,843

 

=============

=============

=============

=============

=============

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

781,004

1,219,649

-

-

-

Other creditors & accruals

189,485

198,618

-

-

-

Hire purchase & lease creditors

7,876

20,223

-

-

-

Amounts owing to director

1,165,306

925,168

-

-

-

 

----------------

----------------

----------------

----------------

----------------

TOTAL CURRENT LIABILITIES

2,143,671

2,363,658

2,132,773

1,742,790

1,789,173

 

----------------

----------------

----------------

----------------

----------------

NET CURRENT ASSETS/(LIABILITIES)

98,059

177,377

119,575

30,921

47,297

 

----------------

----------------

----------------

----------------

----------------

TOTAL NET ASSETS

213,144

329,543

264,699

183,037

143,670

 

=============

=============

=============

=============

=============

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

100,000

100,000

100,000

100,000

100,000

 

----------------

----------------

----------------

----------------

----------------

TOTAL SHARE CAPITAL

100,000

100,000

100,000

100,000

100,000

 

 

 

 

 

 

RESERVES

 

 

 

 

 

Share premium

-

-

-

54,548

-

Retained profit/(loss) carried forward

84,770

192,919

138,666

54,548

32,539

 

----------------

----------------

----------------

----------------

----------------

TOTAL RESERVES

84,770

192,919

138,666

54,548

32,539

 

 

 

 

 

 

 

----------------

----------------

----------------

----------------

----------------

SHAREHOLDERS' FUNDS/EQUITY

184,770

292,919

238,666

154,548

132,539

 

 

 

 

 

 

LONG TERM LIABILITIES

 

 

 

 

 

Hire purchase creditors

18,374

27,124

-

-

-

Deferred taxation

10,000

9,500

-

-

-

 

----------------

----------------

----------------

----------------

----------------

TOTAL LONG TERM LIABILITIES

28,374

36,624

26,033

28,489

11,131

 

----------------

----------------

----------------

----------------

----------------

 

213,144

329,543

264,699

183,037

143,670

 

=============

=============

=============

=============

=============

 

 

 

FINANCIAL RATIO

 

 

MIP TECHNOLOGY SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Cash

36,263

197,055

-

-

-

Net Liquid Funds

36,263

197,055

-

-

-

Net Liquid Assets

<1,298,787>

<502,677>

119,575

30,921

47,297

Net Current Assets/(Liabilities)

98,059

177,377

119,575

30,921

47,297

Net Tangible Assets

213,144

329,543

264,699

183,037

143,670

Net Monetary Assets

<1,327,161>

<539,301>

93,542

2,432

36,166

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

26,250

47,347

-

-

-

Total Liabilities

2,172,045

2,400,282

2,158,806

1,771,279

1,800,304

Total Assets

2,356,815

2,693,201

2,397,472

1,925,827

1,932,843

Net Assets

213,144

329,543

264,699

183,037

143,670

Net Assets Backing

184,770

292,919

238,666

154,548

132,539

Shareholders' Funds

184,770

292,919

238,666

154,548

132,539

Total Share Capital

100,000

100,000

100,000

100,000

100,000

Total Reserves

84,770

192,919

138,666

54,548

32,539

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.02

0.08

-

-

-

Liquid Ratio

0.39

0.79

-

-

-

Current Ratio

1.05

1.08

1.06

1.02

1.03

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

234

51

-

-

-

Debtors Ratio

95

109

-

-

-

Creditors Ratio

166

105

-

-

-

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

0.14

0.16

-

-

-

Liabilities Ratio

11.76

8.19

9.05

11.46

13.58

Times Interest Earned Ratio

<38.31>

38.67

-

-

-

Assets Backing Ratio

2.13

3.30

2.65

1.83

1.44

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

<4.95>

1.46

2.28

0.52

0.36

Net Profit Margin

<4.95>

1.12

1.86

0.52

0.36

Return On Net Assets

<49.37>

22.07

39.00

12.02

9.33

Return On Capital Employed

<47.61>

20.80

39.00

12.02

9.33

Return On Shareholders' Funds/Equity

<58.53>

18.52

35.25

14.24

10.11

Dividend Pay Out Ratio (Times)

0.00

0.00

-

-

-

NOTES TO ACCOUNTS

 

 

 

 

 

Contingent Liabilities

0

0

 

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.61.49

UK Pound

1

Rs.98.71

Euro

1

Rs.84.49

 

 

INFORMATION DETAILS

 

Report Prepared by :

NIT

 

 

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%)

 

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.