MIRA INFORM REPORT

 

 

Report Date :

12.02.2014

 

IDENTIFICATION DETAILS

 

Name :

LOTTE CHEMICAL TITAN TRADING SDN. BHD.

 

 

Formerly Known As :

TITAN TRADING CORP. SDN BHD

 

 

Registered Office :

Bangunan Malaysia Re, 17,Lorong Dungun, Damansara Heights, 6th Floor, 50490 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2012

 

 

Date of Incorporation :

27.04.1988

 

 

Com. Reg. No.:

170232-H

 

 

Legal Form :

Private Limited Company

 

 

Line of Business :

trader of high density polyethlene, lenear low density, high density polyethylene, ethylene & propylene olefin co-products.


Subject also acts as the International Procurement Centre (IPC).

 

 

No. of Employees :

60 [2012]

 


 

RATING & COMMENTS

 

MIRA’s Rating :

A

 

RATING

STATUS

PROPOSED CREDIT LINE

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

 

Status :

Good

 

 

Payment Behaviour :

Regular

 

 

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 – december 01, 2013

 

Country Name

Previous Rating

(30.09.2013)

Current Rating

(01.12.2013)

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.

:

170232-H

COMPANY NAME

:

LOTTE CHEMICAL TITAN TRADING SDN. BHD.

FORMER NAME

:

TITAN TRADING CORP. SDN BHD (20/12/2012)
TITAN POLYETHYLENE (MALAYSIA) SDN BHD (24/11/2005)
ASIA PACIFIC POLYETHYLENE (MALAYSIA) SDN BHD (21/03/1989)
POLIETILENA ASIA PASIFIK (MALAYSIA) SDN BHD (24/05/1988)

INCORPORATION DATE

:

27/04/1988

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

BANGUNAN MALAYSIA RE, 17,LORONG DUNGUN, DAMANSARA HEIGHTS, 6TH FLOOR, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

PLO 312, JALAN TEMBAGA 4, PASIR GUDANG INDUSTRIAL ESTATE, 81700 PASIR GUDANG, JOHOR, MALAYSIA.

TEL.NO.

:

07-2538888

FAX.NO.

:

07-2517881

WEB SITE

:

WWW.TITANGROUP.COM

CONTACT PERSON

:

CHEONG PENG KHUAN ( MANAGING DIRECTOR )

 

 

 

INDUSTRY CODE

:

46691

PRINCIPAL ACTIVITY

:

TRADING OF HIGH DENSITY POLYETHLENE, LENEAR LOW DENSITY, HIGH DENSITY POLYETHYLENE, ETHYLENE & PROPYLENE OLEFIN CO-PRODUCTS

AUTHORISED CAPITAL

:

MYR 310,000,000.00 DIVIDED INTO 
ORDINARY SHARE 310,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 292,500,000.00 DIVIDED INTO 
ORDINARY SHARES 292,500,000 CASH OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 3,511,186,000 [2012]

NET WORTH

:

MYR 737,815,000 [2012]

M1000 OVERALL RANKING

:

161[2011]

M1000 INDUSTRY RANKING

:

4[2011]

 

 

 

STAFF STRENGTH

:

60 [2012]

BANKER (S)

:

MALAYAN BANKING BHD
RHB BANK BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STRONG

PAYMENT

:

PROMPT

MANAGEMENT CAPABILITY

:

AVERAGE

 

 

 

COMMERCIAL RISK

:

LOW

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

GOOD

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 high density polyethlene, lenear low density, high density polyethylene, ethylene, propylene olefin co-products.

 

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

 

According to the Malaysia 1000 publication, the Subject's ranking are as follows:

YEAR

2011

2009

2004

 

OVERALL RANKING

161

139

174

 

INDUSTRY RANKING

4

5

3

 

 

The ultimate holding company of the Subject is HONAM PETROCHEMICAL CORP, a company incorporated in KOREA.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

15/02/2013

MYR 310,000,000.00

MYR 292,500,000.00

 

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


Name

Address

IC/PP/Loc No

Shareholding

(%)

LOTTE CHEMICAL TITAN HOLDING SDN. BHD.

BANGUNAN MALAYSIAN RE, 17, LORONG DUNGUN, DAMANSARA HEIGHTS, 6TH FLOOR, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

222357P

292,500,000.00

100.00

 

 

 

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

------

 

 

 

292,500,000.00

100.00

 

 

 

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

=====

+ Also Director

 

The Subject's interest in other companies (Subsidiaries/Associates) are shown as follow :



Local No

Country

Company

(%)

As At

 

HONG KONG

TITAN TRADING CORP LIMITED

100.00

31/12/2011

 

 

 

 

 

 

 

DIRECTORS

 

DIRECTOR 1

Name Of Subject

:

MR. CHEONG PENG KHUAN

Address

:

LRG HIJAU TIGA, DESA GREEN, BATU LANCANG, 11600 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

5281877

New IC No

:

580222-07-5125

Date of Birth

:

22/02/1958

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

23/02/2010

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

Name Of Subject

:

CHUN MYUNG JIN

Address

:

25, JALAN REDANG 1/1, TAMAN REDANG, 81100 JOHOR BAHRU, JOHOR, MALAYSIA.

IC / PP No

:

M89809195

 

 

 

 

 

 

 

 

 

 

 

 

Date of Appointment

:

02/06/2011

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 3

Name Of Subject

:

LEE HUNKI

Address

:

UNIT A-22-3A, KIARAVILLE CONDO, JALAN CHANGKAT DUTA KIARA, MONT' KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

M43550007

 

 

 

 

 

 

 

 

 

 

 

 

Date of Appointment

:

09/11/2010

 

 

 

 

 

 

 

 

 

 

 

 




MANAGEMENT

 

 

 

1)

Name of Subject

:

CHEONG PENG KHUAN

 

Position

:

MANAGING DIRECTOR

 

 

 

 

 

2)

Name of Subject

:

AZHAR NASRON

 

Position

:

VICE PRESIDENT

 

 

AUDITOR

 

Auditor

:

DELOITTE & TOUCHE

Auditor' Address

:

21, JALAN TUN ABDUL RAZAK SUSUR 1/1, 80000 JOHOR BAHRU, JOHOR, MALAYSIA.

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. KONG CHOCK HOON

 

IC / PP No

:

5800719

 

New IC No

:

600101-01-6001

 

Address

:

JLN DATUK SULAIMAN 6, TAMAN TUN DR ISMAIL TIMUR, 60000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

LEE HUNKI

 

IC / PP No

:

M43550007

 

 

 

 

 

Address

:

UNIT A-22-3A, KIARAVILLE CONDO, JALAN CHANGKAT DUTA KIARA, MONT' KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

 

 

 

 

 

 

2)

Name

:

RHB BANK BHD

 

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

10/03/1992

N/A

ASEAMBANKERS MALAYSIA BHD

MYR 352,250,000.00

Satisfied

2

12/12/1994

N/A

ASEAMBANKERS MALAYSIA BERHAD

MYR 202,000,000.00

Satisfied

3

14/02/1995

N/A

ASEAMBANKERS MALAYSIA BERHAD

MYR 202,000,000.00

Satisfied

4

17/12/2004

N/A

MAYBANK INTERNATIONAL L LTD AS SECURITY AGENT FOR

-

Satisfied

5

17/12/2004

N/A

MALAYAN BANKING BERHAD AS SECURITY AGENT FOR ITSEL

-

Satisfied

6

17/12/2004

N/A

MAYBANK INTERNATIONAL L LTD AS SECURITY AGENT FOR

-

Satisfied

7

27/03/2009

N/A

RHB BANK (L) LTD

USD 332,500,000.00

Satisfied

8

27/03/2009

N/A

RHB BANK (L) LTD

USD 332,500,000.00

Satisfied

9

15/11/2011

DEBENTURE

STANDARD CHARTERED BANK, OFFSHORE LABUAN

USD 116,592,800.00

Unsatisfied

10

15/11/2011

INSURANCE ASSIGNMENT

STANDARD CHARTERED BANK, OFFSHORE LABUAN

USD 116,592,800.00

Unsatisfied

 

 

LEGAL CHECK AGAINST SUBJECT


* A check has been conducted in our databank against 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 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

 

 

 


The Subject 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

[

X

]

 

Good 31-60 Days

[

 

]

 

Average 61-90 Days

[

 

]

 

Fair 91-120 Days

[

 

]

 

Poor >120 Days

[

 

]

 

 

 

 

 

 

 

CLIENTELE

 

Local

:

YES

Percentage

:

60%

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Percentage

:

40%

Export Market

:

AUSTRALIA

SINGAPORE

ASIA

Credit Term

:

AS AGREED

 

 

 

 

 

 

Payment Mode

:

CHEQUES
LETTER OF CREDIT (LC)
TELEGRAPHIC TRANSFER (TT)

Type of Customer

:

MANUFACTURING INDUSTRIES

 

 

 

 

 

 

 

OPERATIONS

 

Goods Traded

:

HIGH DENSITY POLYETHLENE, LENEAR LOW DENSITY, HIGH DENSITY POLYETHYLENE, ETHYLENE, PROPYLENE OLEFIN CO-PRODUCTS

 

 

 

 

Services

:

MARKETING ARM FOR ITS RELATED COMPANIES AND TRADING AS AN INTERNATIONAL PROCUREMENT CENTRE

 

 

 

 

Product Brand Name

:

TITANEX , TITANLENE , TITANZEX

 

 

 

Member(s) / Affiliate(s)

:

FEDERATION OF MALAYSIAN MANUFACTURERS (FMM)CHEMICAL INDUSTRIES COUNCIL OF MALAYSIA (CICM)

 

 

 

Ownership of premises

:

LEASED/RENTED

 

 

Total Number of Employees:

 

YEAR

2012

2011

2010

 

 

 

 

 

 


 

GROUP

N/A

N/A

N/A

 

 

 

 

 

 

COMPANY

60

50

66

 

 

 

 

 

 

 

Branch

:

NO

 

 

Other Information:


The Subject is principally engaged in the (as a / as an) trading of high density polyethlene, lenear low density, high density polyethylene, ethylene & propylene olefin co-products. 

Besides that the Subject also acts as the International Procurement Centre (IPC).

We were informed that the Subject is under the Titan Chemicals Group of Companies and it also acts as the marketing arm for its group.

The Subject's products are includes Ethylene, Propylene, Olefin co-products & Low Density Polythylene Film.

The Subject's products are mainly used in a variety of consumer and industrial applications, including packaging film, trash bags, automotive parts, plastic bottles and caps, and compounds for wire and cable insulation.

The Subject's IPC's status allow the Group to specialize in and centralize all procurement and international sales of raw materials, components and finished products for its operations in Malaysia and Indonesia.

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

07-2538888

Match

:

N/A

 

 

 

Address Provided by Client

:

PLO 312, JALAN TEMBAGA 4, PASIR GUDANG INDUSTRIAL ESTATE,81700,PASIR GUDANG,JOHOR.

Current Address

:

PLO 312, JALAN TEMBAGA 4, PASIR GUDANG INDUSTRIAL ESTATE, 81700 PASIR GUDANG, JOHOR, MALAYSIA.

Match

:

YES

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations

we contacted one of the staff from the Subject and she provided some information.



FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Increased

[

2008 - 2012

]

 

Profit/(Loss) Before Tax

:

Increased

[

2008 - 2012

]

 

Return on Shareholder Funds

:

Acceptable

[

25.09%

]

 

Return on Net Assets

:

Acceptable

[

25.94%

]

 

 

 

 

 

 

 

 

The Subject's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The higher profit could be attributed to the increase in turnover. The Subject's management had generated acceptable return for its shareholders using its assets.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Nil

[

0 Days

]

 

Debtor Ratio

:

Favourable

[

31 Days

]

 

Creditors Ratio

:

Favourable

[

0 Days

]

 

 

 

 

 

 

 

 

As the Subject is a service oriented company, the Subject does not need to keep stocks. The favourable debtors' days could be due to the good credit control measures implemented by the Subject. 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

[

4.23 Times

]

 

Current Ratio

:

Favourable

[

4.23 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

[

40.08 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 :

 

 

 

 

 

 

Generally, the Subject's performance has improved with higher turnover and profit. The Subject was in good liquidity position with its total current liabilities well covered by its total current assets. With its current net assets, the Subject should be able to repay its short term obligations. With the favourable interest cover, the Subject could be able to service all the accrued interest without facing any difficulties. The Subject was a zero gearing company, it was solely dependant on its shareholders to provide funds to finance its business. The Subject has good chance of getting loans, if the needs arises.

 

 

 

 

 

 

 

Overall financial condition of the Subject : STRONG

 

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

46691 : Wholesale of industrial chemicals

 

 

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 1988, the Subject is a Private Limited company, focusing on trading of high density polyethlene, lenear low density, high density polyethylene, ethylene, propylene olefin co-products. Its long establishment in the market has allowed the Subject to build up a good reputation and gain higher market share against its rivals. Having strong support from its holding company has enabled the Subject to remain competitive despite the challenging business environment. The Subject is a large entity with strong capital position. We are confident with the Subject's business and its future growth prospect. 

Over the years, the Subject has established an extensive clientele base in the market. Besides catering to the local market, the Subject has penetrated into other countries. With the contribution of both local and overseas customers, the Subject is likely to be exposed to lower commercial risk. Hence, we believe that the Subject has better business expansion opportunities in the future. The Subject has a good management capability. Its capable management team has enabled the Subject to keep its business on going. Hence, the future prospect of the Subject is bright. 

We noted that both the turnover and profits have increased compared to the previous year. The higher profit could be due to increase in turnover and better control over its operating costs. Return on shareholders' funds of the Subject was at an acceptable range which indicated that the management was efficient in utilising its funds to generate income. 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 737,815,000, the Subject should be able to maintain its business in the near terms. 

The Subject'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 Subject has a good control over its resources. 

We regard that the Subject's overall payment habit is prompt. The Subject had a favourable creditors' ratio as evidenced by its favourable collection days. 

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. 

In view of the above favourable condition, we recommend credit be proceeded to the Subject with favourable term.

 

 


PROFIT AND LOSS ACCOUNT

 

 

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

LOTTE CHEMICAL TITAN TRADING SDN. BHD.

 

Financial Year End

2012-12-31

2011-12-31

2010-12-31

2009-12-31

2008-12-31

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

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

MYR

 

 

 

 

 

 

TURNOVER

3,511,186,000

3,437,047,000

2,687,470,000

2,414,517,000

2,881,921,000

Other Income

-

-

25,186,000

-

-

 

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

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

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

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

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

Total Turnover

3,511,186,000

3,437,047,000

2,712,656,000

2,414,517,000

2,881,921,000

Costs of Goods Sold

(3,276,477,000)

(3,254,972,000)

(2,511,577,000)

-

-

 

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

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

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

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

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

Gross Profit

234,709,000

182,075,000

201,079,000

-

-

 

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

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

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

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

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

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

186,618,000

140,549,000

164,838,000

137,822,000

47,909,000

 

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

186,618,000

140,549,000

164,838,000

137,822,000

47,909,000

Taxation

(1,468,000)

(287,000)

12,000

1,565,000

(2,416,000)

 

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

185,150,000

140,262,000

164,850,000

139,387,000

45,493,000

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

172,340,000

195,796,000

30,946,000

(108,441,000)

(153,934,000)

Prior year adjustment

-

(1,818,000)

-

-

-

 

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

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

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

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

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

As restated

172,340,000

193,978,000

30,946,000

(108,441,000)

(153,934,000)

 

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

357,490,000

334,240,000

195,796,000

30,946,000

(108,441,000)

DIVIDENDS - Ordinary (paid & proposed)

-

(161,900,000)

-

-

-

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

357,490,000

172,340,000

195,796,000

30,946,000

(108,441,000)

 

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

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

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

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

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

 

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

 

Others

4,775,000

2,931,000

3,409,000

3,302,000

5,199,000

 

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

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

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

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

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

 

4,775,000

2,931,000

3,409,000

3,302,000

5,199,000

 

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

LOTTE CHEMICAL TITAN TRADING SDN. BHD.

 

LONG TERM INVESTMENTS/OTHER ASSETS

 

 

 

 

 

Subsidiary companies

3,000

3,000

3,000

3,000

3,000

Deferred assets

31,000

27,000

24,000

2,000

19,000

 

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

34,000

30,000

27,000

5,000

22,000

 

 

 

 

 

 

 

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

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

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

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

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

TOTAL LONG TERM ASSETS

34,000

30,000

27,000

5,000

22,000

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

Trade debtors

295,283,000

385,006,000

219,689,000

261,112,000

272,120,000

Other debtors, deposits & prepayments

373,000

363,000

363,000

487,000

353,000

Short term deposits

-

-

11,050,000

-

26,555,000

Amount due from holding company

8,573,000

8,470,000

1,318,000

1,318,000

1,318,000

Amount due from subsidiary companies

-

-

80,000

379,000

799,000

Amount due from related companies

644,467,000

168,542,000

461,789,000

331,324,000

150,792,000

Cash & bank balances

17,714,000

70,288,000

633,000

2,014,000

28,400,000

Others

-

-

431,000

428,000

-

 

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

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

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

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

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

TOTAL CURRENT ASSETS

966,410,000

632,669,000

695,353,000

597,062,000

480,337,000

 

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

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

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

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

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

TOTAL ASSET

966,444,000

632,699,000

695,380,000

597,067,000

480,359,000

 

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

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

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

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

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

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

-

44,000

-

-

-

Other creditors & accruals

106,568,000

12,658,000

7,535,000

8,909,000

7,290,000

Amounts owing to subsidiary companies

418,000

803,000

-

-

-

Amounts owing to related companies

121,635,000

43,481,000

110,763,000

124,894,000

139,630,000

Provision for taxation

8,000

4,000

-

-

1,289,000

 

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

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

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

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

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

TOTAL CURRENT LIABILITIES

228,629,000

56,990,000

118,298,000

133,803,000

148,209,000

 

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

737,781,000

575,679,000

577,055,000

463,259,000

332,128,000

 

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

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

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

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

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

TOTAL NET ASSETS

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

 

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

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

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

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

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

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

292,500,000

292,500,000

292,500,000

292,500,000

292,500,000

 

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

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

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

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

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

TOTAL SHARE CAPITAL

292,500,000

292,500,000

292,500,000

292,500,000

292,500,000

 

 

 

 

 

 

RESERVES

 

 

 

 

 

Exchange equalisation/fluctuation reserve

87,825,000

110,869,000

88,786,000

139,818,000

148,091,000

Retained profit/(loss) carried forward

357,490,000

172,340,000

195,796,000

30,946,000

(108,441,000)

 

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

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

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

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

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

TOTAL RESERVES

445,315,000

283,209,000

284,582,000

170,764,000

39,650,000

 

 

 

 

 

 

 

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

 

 

 

 

 

 

 

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

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

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

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

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

 

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

 

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

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

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

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

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

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

LOTTE CHEMICAL TITAN TRADING SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Cash

17,714,000

70,288,000

11,683,000

2,014,000

54,955,000

Net Liquid Funds

17,714,000

70,288,000

11,683,000

2,014,000

54,955,000

Net Liquid Assets

737,781,000

575,679,000

577,055,000

463,259,000

332,128,000

Net Current Assets/(Liabilities)

737,781,000

575,679,000

577,055,000

463,259,000

332,128,000

Net Tangible Assets

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

Net Monetary Assets

737,781,000

575,679,000

577,055,000

463,259,000

332,128,000

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

0

0

0

0

0

Total Liabilities

228,629,000

56,990,000

118,298,000

133,803,000

148,209,000

Total Assets

966,444,000

632,699,000

695,380,000

597,067,000

480,359,000

Net Assets

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

Net Assets Backing

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

Shareholders' Funds

737,815,000

575,709,000

577,082,000

463,264,000

332,150,000

Total Share Capital

292,500,000

292,500,000

292,500,000

292,500,000

292,500,000

Total Reserves

445,315,000

283,209,000

284,582,000

170,764,000

39,650,000

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.08

1.23

0.10

0.02

0.37

Liquid Ratio

4.23

11.10

5.88

4.46

3.24

Current Ratio

4.23

11.10

5.88

4.46

3.24

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

0

0

0

0

0

Debtors Ratio

31

41

30

39

34

Creditors Ratio

0

0

0

0

0

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

0.00

0.00

0.00

0.00

0.00

Liabilities Ratio

0.31

0.10

0.20

0.29

0.45

Times Interest Earned Ratio

40.08

48.95

49.35

42.74

10.22

Assets Backing Ratio

2.52

1.97

1.97

1.58

1.14

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

5.31

4.09

6.13

5.71

1.66

Net Profit Margin

5.27

4.08

6.13

5.77

1.58

Return On Net Assets

25.94

24.92

29.15

30.46

15.99

Return On Capital Employed

25.94

24.92

29.15

30.46

15.99

Return On Shareholders' Funds/Equity

25.09

24.36

28.57

30.09

13.70

Dividend Pay Out Ratio (Times)

0.00

1.15

0.00

0.00

0.00

NOTES TO ACCOUNTS

 

 

 

 

 

Contingent Liabilities

0

0

0

0

0





 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.62.44

UK Pound

1

Rs.102.48

Euro

1

Rs.85.28

 

INFORMATION DETAILS

 

Report Prepared by :

NNA

 

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.