MIRA INFORM REPORT

 

 

Report Date :

16.09.2013

 

IDENTIFICATION DETAILS

 

Name :

JAL DIAM SDN. BHD.

 

 

Registered Office :

Menara City One, Letter Box Co 5-01, 3, Jalan Munshi Abdullah, Level 5, 50100 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2011

 

 

Date of Incorporation :

29.09.2001

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Trading Of Precious Stones, Shape Of Diamonds.

 

 

No. of Employees :

02

 

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 :

Slow but correct

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

 

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

560270-K

COMPANY NAME

:

JAL DIAM SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

29/09/2001

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

MENARA CITY ONE, LETTER BOX CO 5-01, 3, JALAN MUNSHI ABDULLAH, LEVEL 5, 50100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

A 15-12, WALDORF TOWER SERVICES APARTMENT, 62, JALAN SRI HARTMAS 1, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

:

N/A

FAX.NO.

:

03-62040107

HP.NO.

:

0122297426

CONTACT PERSON

:

JIGNESH RAMESH KUMAR JHAVERI ( MANAGING DIRECTOR )

 

 

 

INDUSTRY CODE

:

46697

PRINCIPAL ACTIVITY

:

TRADING OF PRECIOUS STONES, SHAPE OF DIAMONDS

AUTHORISED CAPITAL

:

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

ISSUED AND PAID UP CAPITAL

:

MYR 350,000.00 DIVIDED INTO 
ORDINARY SHARES 350,000 CASH OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 10,047,075 [2011]

NET WORTH

:

MYR 658,559 [2011]

 

 

 

STAFF STRENGTH

:

2 [2013]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

LIMITED

PAYMENT

:

AVERAGE

MANAGEMENT CAPABILITY

:

AVERAGE

 

 

 

COMMERCIAL RISK

:

MODERATE

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 precious stones, shape of diamonds.

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

(%)

MS. A.MAHESWARY A/P S.ARJUNAN +

BLOCK C, C01-08, PALM COURT CONDOMINIUM, JALAN BERHALA, BRICKFIELDS, 50470 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

660818-10-6180 A0468347

122,500.00

35.00

JIGNESH RAMESHKUMAR JHAVERI +

A-15-12, WALDORF TOWER SERVICE APARTMENT, 62, JALAN SRI HARTAMAS 1, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Z012926

105,000.00

30.00

MS. SITI SUHANA BINTI MOHAMED OTHMAN

3432, JALAN 18/60B, TAMAN SRI SERDANG, 43400 SERDANG, SELANGOR, MALAYSIA.

790710-01-5098

122,500.00

35.00

 

 

 

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

------

 

 

 

350,000.00

100.00

 

 

 

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

=====

+ Also Director

 

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

JIGNESH RAMESHKUMAR JHAVERI

Address

:

A-15-12, WALDORF TOWER SERVICE APARTMENT, 62, JALAN SRI HARTAMAS 1, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

Z012926

 

 

 

 

 

 

 

 

 

Nationality

:

INDIAN

Date of Appointment

:

29/09/2001

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MS. A.MAHESWARY A/P S.ARJUNAN

Address

:

BLOCK C, C01-08, PALM COURT CONDOMINIUM, JALAN BERHALA, BRICKFIELDS, 50470 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A0468347

New IC No

:

660818-10-6180

Date of Birth

:

18/08/1966

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

29/09/2001

 

 

 



MANAGEMENT

 

 

 

1)

Name of Subject

:

JIGNESH RAMESH KUMAR JHAVERI

 

Position

:

MANAGING DIRECTOR

 

 

 

 

 

 

 

AUDITOR

 

Auditor

:

WSJ & CO

Auditor' Address

:

C/O K.RAMANATHAN & CO., MENARA CITY ONE, LETTER BOX CP5-01, 6, JALAN MUNSHI ABDULLAH, 50100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. M RAMANATHAN A/L S.M. MEYYAPPAN

 

IC / PP No

:

6057502

 

New IC No

:

600923-10-6815

 

Address

:

15, JALAN DATO ABDUL AZIZ 14/29, 46100 PETALING JAYA, SELANGOR, 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

:

INDIA,ASIA,EUROPE



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

[

X

]

 

Fair 91-120 Days

[

 

]

 

Poor >120 Days

[

 

]

 

 

 

 

 

 



CLIENTELE

 

Local

:

YES

Percentage

:

100%

Domestic Markets

:

MALAYSIA

Overseas

:

NO

 

 

 

 

 

 

 

 

 

Credit Term

:

AS AGREED

 

 

 

 

 

 

Payment Mode

:

CHEQUES
CASH

Type of Customer

:

END USERS

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Goods Traded

:

PRECIOUS STONES, SHAPE OF DIAMONDS

 

 

 

 

Ownership of premises

:

LEASED/RENTED

 

 

Total Number of Employees:

 

YEAR

2013

2010

2009

2008

 

GROUP

N/A

N/A

N/A

N/A

 

 

 

 

 

COMPANY

2

2

1

2

 

 

 

 

 

 

Branch

:

YES

 

Other Information:


The SC is principally engaged in the (as a / as an) trading of precious stones, shape of diamonds. 

According to the SC, the SC mainly sells color and decorative stones.


We were informed that the SC only sells limited quantity of diamonds. 


Besides that the SC also provides stones based on the customers' requirements. 



CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the SC indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

0122297426

Match

:

N/A

 

 

 

Address Provided by Client

:

A-15-12, WALDORF TOWER, JLN SRI HARTAMAS, KL-50480

Current Address

:

A 15-12, WALDORF TOWER SERVICES APARTMENT, 62, JALAN SRI HARTMAS 1, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Match

:

NO

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


On 9th September 2013 we contacted one of the SC's Managing Director, Mr Jignesh. He provided some information on the SC.


The SC can only be contacted via its Managing Director's mobile at 012-2297426


The address provided is incomplete.

 

 

FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2007 - 2011

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2007 - 2011

]

 

Return on Shareholder Funds

:

Unfavourable

[

2.18%

]

 

Return on Net Assets

:

Unfavourable

[

3.27%

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.The SC's profit fell sharply because of the high operating costs incurred. The unfavourable return on shareholders' funds could indicate that the SC was inefficient in utilising its assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Acceptable

[

62 Days

]

 

Debtor Ratio

:

Unfavourable

[

222 Days

]

 

Creditors Ratio

:

Unfavourable

[

237 Days

]

 

 

 

 

 

 

 

 

The SC kept adequate stocks to meet its normal business transactions without incurring excessive storage costs. 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

:

Acceptable

[

0.85 Times

]

 

Current Ratio

:

Unfavourable

[

1.09 Times

]

 

 

 

 

 

 

 

 

The SC's liquid ratio was slightly low. This could indicate that the SC's working capital was slightly deficient. The SC will have to improve its liquidity position either by obtaining short term financing or increase its paid up capital so that it can meet all its short term obligations as and when they fall due.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Nil

[

0.00 Times

]

 

Gearing Ratio

:

Favourable

[

0.03 Times

]

 

 

 

 

 

 

 

 

The SC's interest cover was nil as it did not pay any interest during the year. 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 recorded lower profits as its turnover showed a erratic trend. The SC's management was unable to control its costs efficiently as its profit showed a downward trend. The SC's liquidity was at an acceptable range. If the SC is able to obtain further short term financing, it should be able to meet all its short term obligations. The SC did not make any interest payment during the year. The SC was dependent on its shareholders' funds to finance its business needs. 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 : LIMITED

 

 

 

 

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 
(Source : Department of Statistics / Economic Report / Bank Negara Report)

 

 

 

 

 

 



INDUSTRY ANALYSIS

 

MSIC CODE

46697 : Wholesale of precious stones

 

 

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 2001, the SC is a Private Limited company, focusing on trading of precious stones, shape of diamonds. 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. The SC is considered as a small size company with issued and paid up capital standing at RM350,000. 

Over the years, the SC should have build up its clientele base and received supports from its regular customers. Investigation revealed that the SC's interest lies mostly in the local market. Thus, 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 2 employees. Overall, we regard that the SC's management capability is average. This indicates that the SC has greater potential to improve its business performance and raising income for the SC. 

Financially, the SC registered a higher turnover compared to previous year. However, its profits showed a reverse trend. The lower profit achieved was a result of higher operating cost and increased competition. The SC has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. The SC managed to maintain an adequate liquidity level, indicating that the SC has the ability to meet its financial obligations. 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. Given a positive net worth standing at MYR 658,559, the SC should be able to maintain its business in the near terms. 

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. Overall the SC has a good control over its resources. 

The SC's payment habit is average. With its adequate working capital, the SC should be able to pay its short term debts. 

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. 

Based on the above condition, we recommend credit be granted to the SC normally.

 



PROFIT AND LOSS ACCOUNT

 

 

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

JAL DIAM 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

FULL

FULL

Currency

MYR

MYR

MYR

MYR

MYR

 

 

 

 

 

 

TURNOVER

10,047,075

7,590,031

9,580,403

9,480,001

7,671,043

 

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

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

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

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

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

Total Turnover

10,047,075

7,590,031

9,580,403

9,480,001

7,671,043

Costs of Goods Sold

<9,643,842>

<7,239,965>

-

-

-

 

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

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

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

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

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

Gross Profit

403,233

350,066

-

-

-

 

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

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

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

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

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

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

21,505

35,149

91,610

72,966

59,078

 

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

21,505

35,149

91,610

72,966

59,078

Taxation

<7,127>

<8,466>

<19,867>

<16,356>

<12,125>

 

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

14,378

26,683

71,743

56,610

46,953

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

294,181

267,498

195,755

139,145

92,192

 

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

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

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

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

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

As restated

294,181

267,498

195,755

139,145

92,192

 

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

308,559

294,181

267,498

195,755

139,145

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

308,559

294,181

267,498

195,755

139,145

 

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

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

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

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

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

 

 

 

 

 

 

 

 

 

BALANCE SHEET

 

 

JAL DIAM SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

31,914

51,235

62,850

74,145

92,377

 

 

 

 

 

 

 

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

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

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

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

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

TOTAL LONG TERM ASSETS

31,914

51,235

62,850

74,145

92,377

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

Stocks

1,701,033

1,397,691

-

1,996,536

2,427,471

Trade debtors

6,109,576

5,345,188

-

4,596,095

4,602,541

Other debtors, deposits & prepayments

4,835

4,835

-

3,750

3,750

Cash & bank balances

16,954

46,692

-

215,553

58,674

 

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

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

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

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

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

TOTAL CURRENT ASSETS

7,832,398

6,794,406

6,608,350

6,811,934

7,092,436

 

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

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

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

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

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

TOTAL ASSET

7,864,312

6,845,641

6,671,200

6,886,079

7,184,813

 

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

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

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

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

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

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

6,269,962

5,227,576

-

5,591,839

5,821,253

Other creditors & accruals

53,009

47,447

-

33,700

101,823

Hire purchase & lease creditors

17,165

24,366

-

7,200

6,600

Amounts owing to director

864,117

885,851

-

654,868

715,606

Provision for taxation

1,500

16,220

-

23,317

13,186

 

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

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

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

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

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

TOTAL CURRENT LIABILITIES

7,205,753

6,201,460

6,031,502

6,310,924

6,658,468

 

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

626,645

592,946

576,848

501,010

433,968

 

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

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

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

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

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

TOTAL NET ASSETS

658,559

644,181

639,698

575,155

526,345

 

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

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

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

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

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

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

350,000

350,000

350,000

350,000

350,000

 

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

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

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

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

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

TOTAL SHARE CAPITAL

350,000

350,000

350,000

350,000

350,000

 

 

 

 

 

 

RESERVES

 

 

 

 

 

Retained profit/(loss) carried forward

308,559

294,181

267,498

195,755

139,145

 

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

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

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

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

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

TOTAL RESERVES

308,559

294,181

267,498

195,755

139,145

 

 

 

 

 

 

 

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

658,559

644,181

617,498

545,755

489,145

 

 

 

 

 

 

LONG TERM LIABILITIES

 

 

 

 

 

Hire purchase creditors

-

-

-

29,400

37,200

 

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

-

-

22,200

29,400

37,200

 

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

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

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

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

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

 

658,559

644,181

639,698

575,155

526,345

 

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

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

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

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

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

 

 

 

FINANCIAL RATIO

 

 

JAL DIAM SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Cash

16,954

46,692

-

215,553

58,674

Net Liquid Funds

16,954

46,692

-

215,553

58,674

Net Liquid Assets

<1,074,388>

<804,745>

576,848

<1,495,526>

<1,993,503>

Net Current Assets/(Liabilities)

626,645

592,946

576,848

501,010

433,968

Net Tangible Assets

658,559

644,181

639,698

575,155

526,345

Net Monetary Assets

<1,074,388>

<804,745>

554,648

<1,524,926>

<2,030,703>

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

17,165

24,366

-

36,600

43,800

Total Liabilities

7,205,753

6,201,460

6,053,702

6,340,324

6,695,668

Total Assets

7,864,312

6,845,641

6,671,200

6,886,079

7,184,813

Net Assets

658,559

644,181

639,698

575,155

526,345

Net Assets Backing

658,559

644,181

617,498

545,755

489,145

Shareholders' Funds

658,559

644,181

617,498

545,755

489,145

Total Share Capital

350,000

350,000

350,000

350,000

350,000

Total Reserves

308,559

294,181

267,498

195,755

139,145

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.00

0.01

-

0.03

0.01

Liquid Ratio

0.85

0.87

-

0.76

0.70

Current Ratio

1.09

1.10

1.10

1.08

1.07

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

62

67

-

77

116

Debtors Ratio

222

257

-

177

219

Creditors Ratio

237

264

-

215

277

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

0.03

0.04

-

0.07

0.09

Liabilities Ratio

10.94

9.63

9.80

11.62

13.69

Times Interest Earned Ratio

0.00

0.00

-

0.00

0.00

Assets Backing Ratio

1.88

1.84

1.83

1.64

1.50

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

0.21

0.46

0.96

0.77

0.77

Net Profit Margin

0.14

0.35

0.75

0.60

0.61

Return On Net Assets

3.27

5.46

14.32

12.69

11.22

Return On Capital Employed

3.18

5.26

14.32

12.53

11.09

Return On Shareholders' Funds/Equity

2.18

4.14

11.62

10.37

9.60

Dividend Pay Out Ratio (Times)

0.00

0.00

-

0.00

0.00

NOTES TO ACCOUNTS

 

 

 

 

 

Contingent Liabilities

0

0

-

0

0




 

DIAMOND INDUSTRY – INDIA

 

-            From time immemorial, India is well known in the world as the birthplace for diamonds.  It is difficult to trace the origin of diamonds but history says that in the remote past, diamonds were mined only in India. Diamond production in India can be traced back to almost 8th Century B.C.  India, in fact, remained undisputed leader till 18th Century when Brazilian fields were discovered in 1725 followed by emergence of S. Africa, Russia and Australia.

-            The achievement of the Indian diamond industry was possible only due to combination of the manufacturing skills of the Indian workforce and the untiring and unflagging efforts of the Indian diamantaires, supported by progressive Government policies.

-            The area of study of family owned diamond businesses derives its importance from the huge conglomerate of family run organizations which operate in the diamond industry since many generations.

-            Some of the basic traits of family run business enterprises include spirit of entrepreneurship, mutual trust lowers transaction costs, small, nimble and quick to react, information as a source of advantage and philanthropy.

-            Family owned diamond businesses need to improve on many fronts including higher standard of corporate governance, long-term performance – focused strategies, modern management and technology.

-            Utmost caution is to be exercised while dealing with some medium and large diamond traders which are usually engaged in fictitious import – export, inter-company transactions, financially assisted by banks. In the process, several public sector banks lost several hundred million rupees. They mostly diverted borrowed money for diamond business into real estate and capital markets.

-            Excerpts from Times of India dated 30th October 2010 is as under –

 

-            Gem & Jewellery Export Promotion Council in its statistical data has shown the export of polished diamonds to have increase by 28 % in February 2013. Compared to $ 1.4 bn worth of polished diamond export in February, 2012, India exported $ 1.84 billion worth of polished diamonds in February 2013. A senior executive of GJEPC said, “Export of cut and polished diamonds started falling month-wise after the imposition of 2 % of import duty on the polished diamonds. But February, 2013 has given a new ray of hope to the industry as the export of polished diamonds has actually increased by 28 %. It means the industry  is on the track of recovery and round tripping of diamonds has stopped completely.” Demand has started coming from the US, the UK, Japan and China. India’s polished diamond export is expected to cross $ 21 bn in 2013-14.

 

-            The banking sector has started exercising restraint while following prudent risk management norms when lending money to gems and jewellery sector. This follows the implementation of Basel III accord – a global voluntary regulatory standard on bank capital adequacy, stress testing and market liquidity.

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.63.79

UK Pound

1

Rs.100.70

Euro

1

Rs.84.67

 

 

INFORMATION DETAILS

 

Report Prepared by :

NIS

 

 

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.