MIRA INFORM REPORT

Report Date :

23.12.2014

IDENTIFICATION DETAILS

Name :	M L VIJAY SDN. BHD.

Registered Office :	Faber Imperial Court, Jalan Sultan Ismail, Level 15-2, 50250 Kuala Lumpur, Wilayah Persekutuan

Country :	Malaysia

Financials (as on) :	30.06.2013

Date of Incorporation :	24.08.1981

Com. Reg. No.:	74484-P

Legal Form :	Private Limited

Line of Business :	Trading of Fabrics.

No. of Employee :	10 [2014]

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Status :	Satisfactory

Payment Behaviour :	No complaints

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 30, 2014

Country Name

Previous Rating

(30.06.2014)

Current Rating

(30.09.2014)

Malaysia

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 sustained budget deficits, has forced Kuala Lumpur to begin to address fiscal shortfalls, through initial reductions in energy and sugar subsidies and the announcement of the 2015 implementation of a 6% goods and services tax. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies about 32% of government revenue in 2013. Bank Negara 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 earlier raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but retreated in 2013 after he encountered significant opposition from Malay nationalists and other vested interests. In September 2013 NAJIB launched the new Bumiputra Economic Empowerment Program (BEEP), policies that favor and advance the economic condition of ethnic Malays.

Source : CIA

EXECUTIVE SUMMARY

REGISTRATION NO.

74484-P

COMPANY NAME

M L VIJAY SDN. BHD.

FORMER NAME

N/A

INCORPORATION DATE

24/08/1981

COMPANY STATUS

EXIST

LEGAL FORM

PRIVATE LIMITED

LISTED STATUS

REGISTERED ADDRESS

FABER IMPERIAL COURT, JALAN SULTAN ISMAIL, LEVEL 15-2, 50250 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

17, JALAN TUANKU ABDUL RAHMAN,, 50100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

03-26918671/26918726

FAX.NO.

03-26916080

CONTACT PERSON

VIJAY KUMAR A/L MOHINDER LAL DUA ( DIRECTOR )

INDUSTRY CODE

46411 47510

PRINCIPAL ACTIVITY

TRADING OF FABRICS

AUTHORISED CAPITAL

MYR 2,000,000.00 DIVIDED INTO
ORDINARY SHARE 2,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

MYR 2,000,000.00 DIVIDED INTO
ORDINARY SHARES 550,000 CASH AND 1,450,000 OTHERWISE OF MYR 1.00 EACH.

SALES

MYR 12,423,708 [2013]

NET WORTH

MYR 33,948,777 [2013]

STAFF STRENGTH

10 [2014]

BANKER (S)

MALAYAN BANKING BHD

LITIGATION

CLEAR

DEFAULTER CHECK

CLEAR

FINANCIAL CONDITION

FAIR

PAYMENT

N/A

MANAGEMENT CAPABILITY

AVERAGE

COMMERCIAL RISK

MODERATE

CURRENCY EXPOSURE

N/A

GENERAL REPUTATION

SATISFACTORY

INDUSTRY OUTLOOK

AVERAGE GROWTH

HISTORY / BACKGROUND

The Subject 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 Subject must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the Subject 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 Subject is insolvent. The Subject 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 Subject is principally engaged in the (as a / as an) trading of fabrics.

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

Share Capital History

Date	Authorised Shared Capital	Issue & Paid Up Capital
31/12/2013	MYR 2,000,000.00	MYR 2,000,000.00

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

Name	Address	IC/PP/Loc No	Shareholding	(%)
MR. VIJAY KUMAR A/L MOHINDER LAL DUA +	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.	610812-10-5325 6301595	589,760.00	29.49
MS. SWARAN KANTA A/P WADHAWAN MAL +	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.	381111-71-5116 3958364	563,760.00	28.19
MR. MOHINDER LAL DUA A/L L.TIRATH RAM +	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.	321010-71-5155 8032039	538,080.00	26.90
MS. KUMARI RANJANI A/P MOHINDER LAL DUA +	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.	570622-10-6120 5218269	308,400.00	15.42
			---------------	------
			2,000,000.00	100.00
			============	=====

+ Also Director

DIRECTORS

DIRECTOR 1

Name Of Subject	:	MS. KAVITA A/P KRISHNAN CHANDER CHANDNA
Address	:	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	A355055
New IC No	:	640103-75-5066
Date of Birth	:	03/01/1964

Nationality	:	MALAYSIAN
Date of Appointment	:	28/12/1991

DIRECTOR 2

Name Of Subject	:	MS. KUMARI RANJANI A/P MOHINDER LAL DUA
Address	:	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	5218269
New IC No	:	570622-10-6120
Date of Birth	:	22/06/1957

Nationality	:	MALAYSIAN
Date of Appointment	:	01/07/1997

DIRECTOR 3

Name Of Subject	:	MR. MOHINDER LAL DUA A/L L.TIRATH RAM
Address	:	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	8032039
New IC No	:	321010-71-5155
Date of Birth	:	10/10/1932

Nationality	:	MALAYSIAN
Date of Appointment	:	24/08/1981

DIRECTOR 4

Name Of Subject	:	MS. SWARAN KANTA A/P WADHAWAN MAL
Address	:	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	3958364
New IC No	:	381111-71-5116
Date of Birth	:	11/11/1938

Nationality	:	MALAYSIAN
Date of Appointment	:	24/08/1981

DIRECTOR 5

Name Of Subject	:	MR. VIJAY KUMAR A/L MOHINDER LAL DUA
Address	:	14, JALAN BEKA, DAMANSARA HEIGHTS, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	6301595
New IC No	:	610812-10-5325
Date of Birth	:	12/08/1961

Nationality	:	MALAYSIAN
Date of Appointment	:	24/08/1981

MANAGEMENT

1)	Name of Subject	:	VIJAY KUMAR A/L MOHINDER LAL DUA
	Position	:	DIRECTOR

AUDITOR

Auditor	:	M/S SJ GRANT THORNTON
Auditor' Address	:	FABER IMPERIAL COURT, JALAN SULTAN ISMAIL, LEVEL 11-1, 50250 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

COMPANY SECRETARIES

1)	Company Secretary	:	MS. LIM SECK WAH
	IC / PP No	:	5878183
	New IC No	:	591223-02-5430
	Address	:	41, JALAN TAMING INDAH 2, TAMAN TAMING INDAH, BANDAR SUNGAI LONG, 43000 KAJANG, SELANGOR, MALAYSIA.

2)	Company Secretary	:	MR. M. CHANDRASEGARAN A/L S. MURUGASU
	IC / PP No	:	5573205
	New IC No	:	581020-06-5169
	Address	:	1, JALAN SS 18/1, 47500 SUBANG JAYA, SELANGOR, MALAYSIA.

BANKING

Banking relations are maintained principally with:

1)	Name	:	MALAYAN BANKING BHD

Charge No	Creation Date	Charge Description	Chargee Name	Total Charge	Status
1	27/10/1982	N/A	UNITED ASIAN BANK BHD	MYR 510,000.00	Satisfied
2	20/12/1984	N/A	UNITED ASIAN BANK BHD	MYR 320,000.00	Satisfied
3	28/08/1989	N/A	UNITED ASIAN BANK BERHAD	MYR 389,000.00	Satisfied
4	26/11/1994	N/A	PERMATA MERCHANT BANK BERHAD	MYR 500,000.00	Satisfied
5	28/07/1995	N/A	PERMATA MERCHANT BANK BERHAD	MYR 500,000.00	Satisfied
6	23/07/2012	MEMORANDUM OF DEPOSIT	CIMB BANK BERHAD	MYR 1,445,000.00	Unsatisfied

LITIGATION CHECK AGAINST SUBJECT

* A check has been conducted in our databank againt the Subject 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 SUBJECT

* We have checked through the Subject 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.

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

PAYMENT RECORD

SOURCES OF RAW MATERIALS:
Local	:	N/A
Overseas	:	N/A

The Subject refused to disclose its suppliers.

CLIENTELE

Local	:	YES	Percentage	:	100%
Domestic Markets	:	MALAYSIA
Overseas	:	NO

Credit Term	:	N/A

Payment Mode	:	CHEQUES

OPERATIONS

Goods Traded

FABRICS

Total Number of Employees:
YEAR	2014
GROUP	N/A
COMPANY	10

Branch

Other Information:

The Subject is principally engaged in the (as a / as an) trading of fabrics.

The Subject sells all kinds of textiles and fabrics.

CURRENT INVESTIGATION

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client	:	N/A
Current Telephone Number	:	03-26918671/26918726
Match	:	N/A

Address Provided by Client	:	17, JALAN TUANKU ABDUL RAHMAN 50100 KUALA LUMPUR, MALAYSIA
Current Address	:	17, JALAN TUANKU ABDUL RAHMAN,, 50100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
Match	:	YES

Latest Financial Accounts	:	YES

Other Investigations

On 19th December 2014 we contacted one of the staff from the Subject and she provided some information.

FINANCIAL ANALYSIS

Profitability
Turnover	:	Erratic	[	2009 - 2013	]
Profit/(Loss) Before Tax	:	Decreased	[	2009 - 2013	]
Return on Shareholder Funds	:	Unfavourable	[	4.37%	]
Return on Net Assets	:	Unfavourable	[	5.77%	]

The fluctuating turnover reflects the fierce competition among the existing and new market players.The dip in profit could be due to the stiff market competition which reduced the Subject's profit margin. The unfavourable return on shareholders' funds could indicate that the Subject was inefficient in utilising its assets to generate returns.

Working Capital Control
Stock Ratio	:	Favourable	[	44 Days	]
Debtor Ratio	:	Unfavourable	[	248 Days	]
Creditors Ratio	:	Favourable	[	0 Days	]

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The Subject's debtors ratio was high. The Subject should tighten its credit control and improve its collection period. The Subject had a favourable creditors' ratio where the Subject could be taking advantage of the cash discounts and also wanting to maintain goodwill with its creditors.

Liquidity
Liquid Ratio	:	Favourable	[	27.39 Times	]
Current Ratio	:	Favourable	[	29.27 Times	]

A minimum liquid ratio of 1 should be maintained by the Subject in order to assure its creditors of its ability to meet short term obligations and the Subject was in a good liquidity position. Thus, we believe the Subject is able to meet all its short term obligations as and when they fall due.

Solvency
Interest Cover	:	Favourable	[	226.24 Times	]
Gearing Ratio	:	Favourable	[	0.00 Times	]

The interest cover showed that the Subject was able to service the interest. The favourable interest cover could indicate that the Subject was making enough profit to pay for the interest accrued. The Subject had no gearing and hence it had virtually no financial risk. The Subject was financed by its shareholders' funds and internally generated fund. During the economic downturn, the Subject, having a zero gearing, will be able to compete better than those which are highly geared in the same industry.


Overall Assessment :


Overall financial condition of the Subject : FAIR

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

Major Economic Indicators:	2011	2012	2013	2014*	2015**

Population ( Million)	28.7	29.3	29.8	30.3	30.5
Gross Domestic Products ( % )	5.1	5.6	5.3	6.0	6.0
Domestic Demand ( % )	8.2	9.4	5.6	6.4	6.2
Private Expenditure ( % )	8.2	8.0	8.6	7.9	6.9
Consumption ( % )	7.1	1.0	5.7	6.5	5.6
Investment ( % )	12.2	11.7	13.3	12.0	10.7
Public Expenditure ( % )	8.4	13.3	4.4	2.3	4.2
Consumption ( % )	16.1	11.3	(1.2)	2.1	3.8
Investment ( % )	(0.3)	15.9	4.2	2.6	4.7

Balance of Trade ( MYR Million )	116,058	106,300	71,298	52,314	-
Government Finance ( MYR Million )	(45,511)	(42,297)	(39,993)	(37,291)	-
Government Finance to GDP / Fiscal Deficit ( % )	(5.4)	(4.5)	(4.0)	(3.5)	(3.0)
Inflation ( % Change in Composite CPI)	3.1	1.6	2.5	3.3	4.0
Unemployment Rate	3.3	3.2	3.0	3.0	3.0

Net International Reserves ( MYR Billion )	415	427	-	417	-
Average Risk-Weighted Capital Adequacy Ratio ( % )	3.50	2.20	-	-	-
Average 3 Months of Non-performing Loans ( % )	14.80	14.70	-	-	-
Average Base Lending Rate ( % )	6.60	6.53	6.53	-	-
Business Loans Disbursed( % )	15.3	32.2	-	-	-
Foreign Investment ( MYR Million )	23,546.1	26,230.4	38,238.0	-	-
Consumer Loans ( % )	-	-	-	-	-

Registration of New Companies ( No. )	45,455	45,441	46,321	-	-
Registration of New Companies ( % )	3.0	(0.0)	1.9	-	-
Liquidation of Companies ( No. )	132,485	17,092	26,430	-	-
Liquidation of Companies ( % )	417.8	(87.1)	54.6	-	-

Registration of New Business ( No. )	284,598	324,761	329,895	-	-
Registration of New Business ( % )	5.0	14.0	2.0	-	-
Business Dissolved ( No. )	20,121	20,380	18,161	-	-
Business Dissolved ( % )	1.9	1.3	(10.9)	-	-

Sales of New Passenger Cars (' 000 Unit )	535.1	552.2	576.7	598.4	610.3
Cellular Phone Subscribers ( Million )	35.3	38.5	43.0	43.8	-
Tourist Arrival ( Million Persons )	24.7	25.0	25.7	28.0	-
Hotel Occupancy Rate ( % )	60.6	62.4	62.6	-	-

Credit Cards Spending ( % )	15.6	12.6	-	-	-
Bad Cheque Offenders (No.)	32,627	26,982	28,876	-	-
Individual Bankruptcy ( No.)	19,167	19,575	21,984	-	-
Individual Bankruptcy ( % )	5.8	2.1	12.3	-	-

INDUSTRIES ( % of Growth ):	2011	2012	2013	2014*	2015**

Agriculture	5.8	1.0	2.1	3.8	3.1
Palm Oil	10.8	(0.3)	2.6	6.7	-
Rubber	6.1	(7.9)	(10.1)	(10.4)	-
Forestry & Logging	(7.6)	(4.5)	(7.8)	(4.2)	-
Fishing	2.1	4.3	1.6	2.7	-
Other Agriculture	7.1	6.4	8.2	6.2	-
Industry Non-Performing Loans ( MYR Million )	634.1	-	-	-	-
% of Industry Non-Performing Loans	3.2	-	-	-	-

Mining	(5.4)	1.4	0.9	(0.8)	2.8
Oil & Gas	(1.7)	-	-	-	-
Other Mining	-	-	-	-	-
Industry Non-performing Loans ( MYR Million )	46.5	-	-	-	-
% of Industry Non-performing Loans	0.1	-	-	-	-

Manufacturing #	4.7	4.8	3.4	6.6	5.5
Exported-oriented Industries	4.1	6.5	3.3	5.6	-
Electrical & Electronics	(4.0)	12.7	6.9	13.3	-
Rubber Products	20.7	3.0	11.7	(0.3)	-
Wood Products	(5.1)	8.7	(2.7)	5.1	-
Textiles & Apparel	13.2	(7.1)	(2.6)	11.5	-
Domestic-oriented Industries	10.7	1.7	6.8	9.4	-
Food, Beverages & Tobacco	4.80	2.70	3.60	6.13	6.13
Chemical & Chemical Products	10.0	10.8	5.6	-	-
Plastic Products	3.8	-	-	-	-
Iron & Steel	2.2	(6.6)	5.0	0.1	-
Fabricated Metal Products	21.8	13.8	9.9	2.9	-
Non-metallic Mineral	12.1	2.9	(2.0)	5.4	-
Transport Equipment	12.0	3.4	13.8	22.9	-
Paper & Paper Products	9.5	3.1	1.8	4.7	-
Crude Oil Refineries	9.3	-	-	-	-
Industry Non-Performing Loans ( MYR Million )	6,537.2	-	-	-	-
% of Industry Non-Performing Loans	25.7	-	-	-	-

Construction	4.7	18.6	10.9	12.7	10.7
Industry Non-Performing Loans ( MYR Million )	3,856.9	-	-	-	-
% of Industry Non-Performing Loans	10.2	-	-	-	-

Services	7.1	6.4	5.9	5.9	5.6
Electric, Gas & Water	3.5	4.4	4.2	3.6	3.9
Transport, Storage & Communication	6.50	7.10	7.30	7.50	7.15
Wholesale, Retail, Hotel & Restaurant	5.2	4.7	5.9	6.9	6.5
Finance, Insurance & Real Estate	6.90	9.70	3.70	4.65	4.25
Government Services	12.4	9.4	8.3	6.1	5.6
Other Services	5.1	3.9	5.1	4.8	4.5
Industry Non-Performing Loans ( MYR Million )	6,825.2	-	-	-	-
% of Industry Non-Performing Loans	23.4	-	-	-	-


* Estimate / Preliminary
** Forecast
# Based On Manufacturing Production Index

INDUSTRY ANALYSIS

MSIC CODE
46411 : Wholesale of yarn and fabrics
47510 : Retail sale of textiles in specialized stores

INDUSTRY :	TRADING


The wholesale and retail trade is expected to increase 7.1% in 2015 (2014: 7.7%) driven by strong domestic consumption and higher tourist arrivals following the Malaysia Year of Festivals 2015. Besides, in 2014, the wholesale and retail trade subsector is expected to increase 7.7% (2013: 6.4%) supported by strong domestic consumption.

According to Retail Group Malaysia (RGM), the pharmacy and personal care sub-sector had slow growth rate of 2.6% for the first quarter of 2014, while "other specialty stores" grew at a rate of 3.5%. During the first quarter of 2014, fashion and fashion accessories recorded a sustainable growth of 6.3% as compared with the same period last year (3.6%).

The retail segment increased 10.1% (January - June 2013: 7.1%) attributed to brisk sales in retail outlets such as hypermarkets and large-scale superstores. Since the launch of the Small Retailer Transformation programme (TUKAR) in January 2011 up to end-July 2014, 1,761 small retailer stores (end-July 2013: 1,381) have been modernized to improve their competitiveness. In addition, the strong growth of the retail segment was supported by 1Malaysia Unified Sales held from 29 June 2014 to 1 September 2014 to attract foreign and local tourists to shop in Malaysia. Meanwhile, the wholesale segment expanded 8.2% (January - June 2013: 4.9%) due to higher sales of non-agricultural intermediate products, such as petrol, diesel, lubricants and household goods. Furthermore, food and beverage outlets, laundry outlets, car wash centres, abd health and beauty outlets took a hit from the water rationing in the Klang Valley since February this year.

On the other hand, in 2014, Malaysia's total trade is expected to grow 5.2% to RM1.44 trillion (2013: 4.5%; RM1.37 trillion) underpinned by recovery in key advanced economies, resilient regional demand, and partly due to the base effect arising from sluggish exports in the corresponding period last year. Gross exports are anticipated to expand 6% to RM762.8 billion while import decreased 4.3% to RM677.2 billion (2013: 2.4%; RM719.8 billion; 7%; RM 649.1 billion). Consequently, the trade surplus is expected to be higher at RM85.6 billion or 7.9% of GDP in 2014 (2013: RM70.7 billion; 7.2%).

Furthermore, gross exports rebounded by 10.7% to RM441.3 billion during the first seven months of 2014 (January - July 2013: -2.8%; RM398.5 billion), with manufactured and mining exports rising at a double digit pace of 11.4% and 12.5%. Shipment of agriculture products grew at a slower pace of 2.7%, primarily due to lower receipts of crude rubber (-24.6%) while export growth of other commodities remained steady. Consequently, exports of manufactured and mining products are expected to grow 6.1% and 6.4% in 2014 (2013: 5.1%; 3.3%). Meanwhile, agriculture exports are expected to rebound sharply by 4.5% in 2014 (2013: -14.4%) despite moderating commodity prices. Malaysia's top 3 trading partners are China, Singapore, and Japan.

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 1981, the Subject is a Private Limited company, focusing on trading of fabrics. The Subject has been in business for over two decades. It has built up a strong clientele base and satisfactory reputation will enable the Subject to further enhance its business in the near term. The Subject is expected to enjoy a stable market shares. With a paid up capital of MYR 2,000,000, the Subject has greater opportunities to expand its business when the needs arise. Under the control of its directors, we considered that the Subject's business position in the market is much dependent on their abilities.

Over the years, the Subject should have build up its clientele base and received supports from its regular customers. Investigation revealed that the Subject's interest lies mostly in the local market. Thus, any adverse changes to the local economy might have a negative impact on the Subject's business performance. Being a small company, the Subject's business operation is supported by 10 employees. Overall, we regard that the Subject's management capability is average. This indicates that the Subject has greater potential to improve its business performance and raising income for the Subject.

Financially, the Subject 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 Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. The Subject is in good liquidity position with its current liabilities well covered by it current assets. Hence, it has sufficient working capital to meet its short term financial obligations. Being a zero geared company, the Subject virtually has no financial risk as it is mainly dependent on its internal funds to finance its business. Given a positive net worth standing at MYR 33,948,777, the Subject should be able to maintain its business in the near terms.

Having a strong assets backing, the Subject possesses latent assets as collateral for further financial extension. Hence, it has good chance of getting loans if the needs arises.

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

Based on the above condition, we recommend credit be granted to the Subject promptly.

PROFIT AND LOSS ACCOUNT

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

Financial Year End	2013-06-30	2012-06-30	2011-06-30	2010-06-30	2009-06-30
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	12,423,708	11,508,902	12,188,526	13,818,543	14,968,625
	----------------	----------------	----------------	----------------	----------------
Total Turnover	12,423,708	11,508,902	12,188,526	13,818,543	14,968,625
Costs of Goods Sold	(9,596,748)	(8,916,754)	-	-	-
	----------------	----------------	----------------	----------------	----------------
Gross Profit	2,826,960	2,592,148	-	-	-
	----------------	----------------	----------------	----------------	----------------

PROFIT/(LOSS) FROM OPERATIONS	1,951,057	2,286,626	2,177,113	2,835,574	2,184,672
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE TAXATION	1,951,057	2,286,626	2,177,113	2,835,574	2,184,672
Taxation	(469,000)	(425,000)	(442,500)	(756,000)	(575,000)
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) AFTER TAXATION	1,482,057	1,861,626	1,734,613	2,079,574	1,609,672
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported	30,466,720	28,605,094	26,870,481	24,790,907	23,181,235
	----------------	----------------	----------------	----------------	----------------
As restated	30,466,720	28,605,094	26,870,481	24,790,907	23,181,235
	----------------	----------------	----------------	----------------	----------------
PROFIT AVAILABLE FOR APPROPRIATIONS	31,948,777	30,466,720	28,605,094	26,870,481	24,790,907
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD	31,948,777	30,466,720	28,605,094	26,870,481	24,790,907
	=============	=============	=============	=============	=============

INTEREST EXPENSE (as per notes to P&L)
Others	8,662	8,382	-	-	-
	----------------	----------------	----------------	----------------	----------------
	8,662	8,382	-	-	-
	=============	=============

BALANCE SHEET

ASSETS EMPLOYED:
FIXED ASSETS	6,541,854	6,655,511	6,911,146	6,999,276	7,260,329

Investments	1,900,000	1,900,000	-	-	-
Others	2,856,481	2,856,481	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS	4,756,481	4,756,481	-	-	-

	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM ASSETS	11,298,335	11,411,992	6,911,146	6,999,276	7,260,329

Stocks	1,502,992	1,542,789	-	-	-
Trade debtors	8,454,516	8,332,285	-	-	-
Other debtors, deposits & prepayments	49,773	78,833	-	-	-
Deposits with financial institutions	13,258,209	11,736,009	-	-	-
Cash & bank balances	41,906	150,904	-	-	-
Others	146,793	135,793	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT ASSETS	23,454,189	21,976,613	24,462,142	23,263,452	21,164,968
	----------------	----------------	----------------	----------------	----------------
TOTAL ASSET	34,752,524	33,388,605	31,373,288	30,262,728	28,425,297
	=============	=============	=============	=============	=============

Other creditors & accruals	178,063	152,132	-	-	-
Short term borrowings/Term loans	-	146,000	-	-	-
Amounts owing to director	623,284	621,353	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	801,347	919,485	765,794	1,389,847	1,631,990
	----------------	----------------	----------------	----------------	----------------
NET CURRENT ASSETS/(LIABILITIES)	22,652,842	21,057,128	23,696,348	21,873,605	19,532,978
	----------------	----------------	----------------	----------------	----------------
TOTAL NET ASSETS	33,951,177	32,469,120	30,607,494	28,872,881	26,793,307
	=============	=============	=============	=============	=============

SHARE CAPITAL
Ordinary share capital	2,000,000	2,000,000	2,000,000	2,000,000	2,000,000
	----------------	----------------	----------------	----------------	----------------
TOTAL SHARE CAPITAL	2,000,000	2,000,000	2,000,000	2,000,000	2,000,000

Retained profit/(loss) carried forward	31,948,777	30,466,720	28,605,094	26,870,481	24,790,907
	----------------	----------------	----------------	----------------	----------------
TOTAL RESERVES	31,948,777	30,466,720	28,605,094	26,870,481	24,790,907

	----------------	----------------	----------------	----------------	----------------
SHAREHOLDERS' FUNDS/EQUITY	33,948,777	32,466,720	30,605,094	28,870,481	26,790,907

Deferred taxation	2,400	2,400	-	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	2,400	2,400	2,400	2,400	2,400
	----------------	----------------	----------------	----------------	----------------
	33,951,177	32,469,120	30,607,494	28,872,881	26,793,307
	=============	=============	=============	=============	=============

FINANCIAL RATIO

TYPES OF FUNDS
Cash	41,906	150,904	-	-	-
Net Liquid Funds	41,906	150,904	-	-	-
Net Liquid Assets	21,149,850	19,514,339	23,696,348	21,873,605	19,532,978
Net Current Assets/(Liabilities)	22,652,842	21,057,128	23,696,348	21,873,605	19,532,978
Net Tangible Assets	33,951,177	32,469,120	30,607,494	28,872,881	26,793,307
Net Monetary Assets	21,147,450	19,511,939	23,693,948	21,871,205	19,530,578
BALANCE SHEET ITEMS
Total Borrowings	0	146,000	-	-	-
Total Liabilities	803,747	921,885	768,194	1,392,247	1,634,390
Total Assets	34,752,524	33,388,605	31,373,288	30,262,728	28,425,297
Net Assets	33,951,177	32,469,120	30,607,494	28,872,881	26,793,307
Net Assets Backing	33,948,777	32,466,720	30,605,094	28,870,481	26,790,907
Shareholders' Funds	33,948,777	32,466,720	30,605,094	28,870,481	26,790,907
Total Share Capital	2,000,000	2,000,000	2,000,000	2,000,000	2,000,000
Total Reserves	31,948,777	30,466,720	28,605,094	26,870,481	24,790,907
LIQUIDITY (Times)
Cash Ratio	0.05	0.16	-	-	-
Liquid Ratio	27.39	22.22	-	-	-
Current Ratio	29.27	23.90	31.94	16.74	12.97
WORKING CAPITAL CONTROL (Days)
Stock Ratio	44	49	-	-	-
Debtors Ratio	248	264	-	-	-
Creditors Ratio	0	0	-	-	-
SOLVENCY RATIOS (Times)
Gearing Ratio	0.00	0.00	-	-	-
Liabilities Ratio	0.02	0.03	0.03	0.05	0.06
Times Interest Earned Ratio	226.24	273.80	-	-	-
Assets Backing Ratio	16.98	16.23	15.30	14.44	13.40
PERFORMANCE RATIO (%)
Operating Profit Margin	15.70	19.87	17.86	20.52	14.60
Net Profit Margin	11.93	16.18	14.23	15.05	10.75
Return On Net Assets	5.77	7.07	7.11	9.82	8.15
Return On Capital Employed	5.77	7.07	7.11	9.82	8.15
Return On Shareholders' Funds/Equity	4.37	5.73	5.67	7.20	6.01
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.63.17
UK Pound	1	Rs.98.85
Euro	1	Rs.77.42

INFORMATION DETAILS

Analysis Done by :	DIV

Report Prepared by :	ANK

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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