MIRA INFORM REPORT

 

 

Report Date :

24.03.2014

 

IDENTIFICATION DETAILS

 

Name :

ACIDCHEM INTERNATIONAL SDN. BHD.

 

 

Formerly Known As :

PALMCHEM (M) SDN BHD

 

 

Registered Office :

2411, Lorong Perusahaan Satu, Prai Industrial Complex, 13600 Prai, Pulau Pinang

 

 

Country :

Malaysia

 

 

Financials (as on) :

30.06.2013

 

 

Date of Incorporation :

16.12.1983

 

 

Com. Reg. No.:

111715-H

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Manufacture of Fatty Acids and Glycerine

 

 

No. of Employees :

650 [2014]

 

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 – September 30, 2013

 

Country Name

Previous Rating

(30.06.2013)

Current Rating

(30.09.2013)

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.

:

111715-H

COMPANY NAME

:

ACIDCHEM INTERNATIONAL SDN. BHD.

FORMER NAME

:

PALMCHEM (M) SDN BHD (05/07/1995)
GOLDSTONE SENDIRIAN BHD (16/06/1988)

INCORPORATION DATE

:

16/12/1983

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

2411, LORONG PERUSAHAAN SATU, PRAI INDUSTRIAL COMPLEX, 13600 PRAI, PULAU PINANG, MALAYSIA.

BUSINESS ADDRESS

:

2411,LORONG PERUSAHAAN SATU, PRAI INDUSTRIAL COMPLEX, 13600 PRAI, PULAU PINANG, MALAYSIA.

TEL.NO.

:

04-3907818

FAX.NO.

:

04-3907252

EMAIL

:

SALES@IOIOLEO.COM

WEB SITE

:

WWW.IOIOLEO.COM.MY

CONTACT PERSON

:

LEE YEOW CHOR ( EXECUTIVE DIRECTOR )

INDUSTRY CODE

:

202

PRINCIPAL ACTIVITY

:

MANUFACTURE OF FATTY ACIDS AND GLYCERINE

AUTHORISED CAPITAL

:

MYR 25,000,000.00 DIVIDED INTO
ORDINARY SHARE 24,500,000.00 OF MYR 1.00 EACH.
PREFERENCE SHARE 500,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 20,000,000.00 DIVIDED INTO
ORDINARY SHARES 20,000,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 1,351,898,903 [2013]

NET WORTH

:

MYR 348,996,456 [2013]

M1000 OVERALL RANKING

:

293[2011]

M1000 INDUSTRY RANKING

:

13[2011]

STAFF STRENGTH

:

650 [2014]

BANKER (S)

:

CIMB BANK BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STRONG

PAYMENT

:

PROMPT

MANAGEMENT CAPABILITY

:

GOOD

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) manufacture of fatty acids and glycerine.

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

2008

2005

2004

OVERALL RANKING

293

334

316

325

415

INDUSTRY RANKING

13

21

16

16

14

 

The immediate holding company of the Subject is IOI OLEOCHEMICAL INDUSTRIES BERHAD, a company incorporated in MALAYSIA.

The ultimate holding company of the Subject is IOI CORPORATION BHD, a company incorporated in MALAYSIA.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

15/02/2013

MYR 25,000,000.00

MYR 20,000,000.00

29/01/1991

MYR 15,000,000.00

MYR 11,000,000.00

30/06/1988

MYR 1,000,000.00

MYR 1,000,000.00

 

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

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

IOI OLEOCHEMICAL INDUSTRIES BERHAD

TWO IOI SQUARE, IOI RESORT, 62502 PUTRAJAYA, WILAYAH PERSEKUTUAN, MALAYSIA.

29994

20,000,000.00

100.00

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

------

20,000,000.00

100.00

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

=====

+ Also Director

 

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

 

Local No

Country

Company

(%)

As At

DENMARK

IOI OLEO (EUROPE) APS

100.00

31/12/2012

UNITED STATES

ACIDCHEM (USA) INC.

100.00

31/12/2012



DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. TAN KEAN HUA

Address

:

14, JALAN 31/74B, KOTA KEMUNING, 40460 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

7228989

New IC No

:

640202-10-5499

Date of Birth

:

02/02/1964

Nationality

:

MALAYSIAN

Date of Appointment

:

01/07/2006

 

DIRECTOR 2

 

Name Of Subject

:

DATO' LEE YEOW CHOR

Address

:

6, JALAN BEVERLY UTAMA, IOI RESORT, 62502 PUTRAJAYA, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A0579701

New IC No

:

661129-10-5443

Date of Birth

:

29/11/1966

Nationality

:

MALAYSIAN

Date of Appointment

:

01/03/2002

Qualification

:

LLB (HONS) KING'S COLLEGE, UNIVERSITY OF LONDON & WAS CALLED AS A BARRISTER AT GRAY'S INN. HE ALSO HOLDS A POSTGRADUATE DIPLOMA IN FINANCE AND ACCOUNTING FROM THE LONDON SCHOOL OF ECONOMICS.

Profile

:

CURRENTLY SERVES AS THE NATIONAL SECRETARY-GENERAL OF THE MALAYSIA REAL ESTATE & HOUSING DEVELOPERS' ASSOCIATION (REHDA).

Other Info

:

HE IS A COUNCIL MEMBER OF THE MALAYSIAN PALM OIL ASSOCIATION (MPOA) AND A COUNCIL MEMBER OF THE MALAYSIAN ASSOCIATION OF HOTEL OWNERS.

 

DIRECTOR 3

 

Name Of Subject

:

MR. LAI CHOON WAH

Address

:

31, LORONG BAKAP INDAH 7, TAMAN BAKAP INDAH, 14200 SUNGAI BAKAP, PULAU PINANG, MALAYSIA.

IC / PP No

:

6954570

New IC No

:

630219-07-5565

Date of Birth

:

19/02/1963

Nationality

:

MALAYSIAN

Date of Appointment

:

16/12/2013

 

 

MANAGEMENT

 

 

1)

Name of Subject

:

LEE YEOW CHOR

Position

:

EXECUTIVE DIRECTOR

 

2)

Name of Subject

:

ENG HONG AI

Position

:

FINANCE MANAGER

 

3)

Name of Subject

:

KHOO TIANG CHENG

Position

:

GENERAL MANAGER

 

4)

Name of Subject

:

LEE KIM ENG

Position

:

MARKETING MANAGER

 

5)

Name of Subject

:

IRIN DE CRUZ

Position

:

SENIOR HUMAN RESOURCE MANAGER

 

 

 

AUDITOR

 

Auditor

:

KPMG

Auditor' Address

:

HUNZA TOWER, 163E, JALAN KELAWEI, LEVEL 18, 10250 GEORGETOWN, PULAU PINANG, MALAYSIA.

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. TAN CHOONG KHIANG

IC / PP No

:

A1672702

New IC No

:

701016-07-5317

Address

:

7, JALAN PUJ 2/28, TAMAN PUNCAK JALIL, BANDAR PUTRA PERMAI, SERI KEMBANGAN, 43300 BALAKONG, SELANGOR, MALAYSIA.

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

CIMB BANK BHD

 

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

14/01/1989

N/A

BANK BUMIPUTRA MALAYSIA BHD

MYR 19,000,000.00

Satisfied

2

22/11/1989

N/A

BANK BUMIPUTRA MALAYSIA BERHAD AND TRUSTEE

MYR 19,000,000.00

Satisfied

3

26/03/1992

GENERAL SECURITY AGREEMENT

HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED

-

Unsatisfied

4

26/03/1992

GENERAL LETTER OF PLEDGE

HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED

-

Unsatisfied

5

26/03/1992

NEGATIVE PLEDGE

HONGKONG AND SHANGHAI BANKING CORPORATION LIMITED

-

Unsatisfied

6

20/07/1993

N/A

DEVELOPMENT COMMERCIAL BANK BHD

MYR 20,000,000.00

Satisfied

 

 

LEGAL 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 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

:

ASIA,EUROPE


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

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

ASIA

Credit Term

:

AS AGREED

Payment Mode

:

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

Type of Customer

:

AGENTS,DEALERS,COSMETIC INDUSTRY,PHARMACEUTICAL INDUSTRIES

 

OPERATIONS

 

Products manufactured

:

FATTY ACIDS AND GLYCERINE

Product Brand Name

:

GLYCERINE, PALMACN

Award

:

1 ) CERTIFICATE OF EXCELLENCE Year :2007
2 ) MS ISO 14001 Year :2005
3 ) OHSAS 18001 Year :2005
4 ) MS ISO 9001 : 2000 Year :2003

Member(s) / Affiliate(s)

:

FEDERATION OF MALAYSIAN MANUFACTURERS (FMM)

MALAYSIA EXTERNAL TRADE DEVELOPMENT CORPORATION (MATRADE)

SMALL & MEDIUM ENTERPRISE

CHEMICAL INDUSTRIES COUNCIL OF MALAYSIA (CICM)

MALAYSIA FOOD & BEVERAGE INDUSTRY

Ownership of premises

:

OWNED

Production Line

:

N/A

Production Capacity

:

APPROXIMATELY 320,000 METRIC TONNES PER YEAR OF FATTY ACID AND GLYCERINE

Shifts

:

3

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010

GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

650

800

800

800

600

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) manufacture of fatty acids and glycerine.


The subject is the first plant in the world using Palm Oil and Palm Kernal Oil exclusively as feedstock in the oleochemical industry.


The subject's product range covers straight distilled, fractionated and hydrogenated fatty acids and oleic acid, BP/USP grades of Glycerine and tailor-made grades for specific niche applications.


The subject undertakes the production and marketing of fatty acid and glycerine and the production capacity per annum is approximately 710,000MT, which is equivalent to 10% global market share.


The subject emerged as the world's largest oleochemical producer following its acquisition of Pan Century Edible Oils and Pan Century Oleochemicals.

The subject entered a 40% joint-venture with Peter Greven of Germany to form Peter Greven Asia Sdn Bhd.


RECENT DEVELOPMENT


20/02/2014

Shares in plantation companies, led by IOI Corp Bhd, surged to their highest in weeks on rising crude palm oil (CPO) futures prices.

 

Kenanga Research expects falling palm oil inventory to push prices higher, at least in the near term.


“We reiterate our view that CPO prices should continue to appreciate up to RM2,900 per tonne by end-March as we expect sustained inventory downtrend throughout the first quarter of the year,” Kenanga Research told clients.


Shares in plantation counters like Genting Plantations Bhd, IOI Corp Bhd and Kuala Lumpur Kepong Bhd (KLK) ended up by 0.95%, 5.75% and 3.81% to RM10.60, RM4.60 and RM24.50 respectively.


Another planter TSH Resources Bhd also finished the day 1.35% higher to RM3.


CPO futures surged convincingly to break its psychological level of RM2,700 on Tuesday, reaching their highest level in 17 months since September 2012, according to a note by Kenanga.


At yesterday’s close, forward three-month CPO futures were at RM2,708 per tonne.


Kenanga said its top picks for the sector were IOI Corp and TSH.


“We believe IOI Corp’s valuation should re-rate higher post its demerger exercise with IOI Properties as it has emerged as the biggest and most efficient integrated palm oil players,” it said.


It noted that IOI Corp’s fresh fruit bunch yield at 24.46 tonnes per ha was also the highest among big-cap planters.

It also said it liked TSH due to its high FFB growth, noting that for the period of January to September 2013, its FFB output was already showing 34% growth (year-on-year) to 379,673 tonnes (strongest growth among its peers).

Kenanga in its note added that Indonesian state-owned energy firm Pertamina had recently completed its second tender of biodiesel and that this should bode well for CPO prices too as it created additional sustainable demand for CPO.


StarBiz reported recently that market sentiment was well supported by the lower-than-expected palm oil stock figures by the Malaysian Palm Oil Board (MPOB) and tight supply in the soybean-producing countries of Brazil and Argentina.


MPOB said the palm oil inventory in January had fallen 2.63% to 1.93 million tonnes, the lowest in three months, while CPO production eased 9.6% to 1.50 million tonnes from a month earlier.


27/01/2014

IOI City Mall, which will be opening its doors by year-end, will recoup its investment within three years of operations, according to operator IOI City Mall Sdn Bhd marketing and leasing head Chris Chong.


“We’re here for the long term but are convinced of breaking even within three years or so,” he told StarBiz.

About RM1.5bil has been invested to build the mall, which will be located just a stone’s throw away from IOI Resort in Putrajaya.


Construction of the mall, which has a net lettable area of 1.4 million sq ft (roughly the size of Pavilion in Kuala Lumpur) across four levels, is targeted for completion by the middle of this year.


“The occupancy rate is currently at around 80%. We expect it to be almost 100% by the time we open at the end of the year,” said Chong.


The mall will be anchored by department store Parkson, a British hypermarket, Golden Screen Cinemas and Thailand-based home centre HomePro.


Its main retail offering will be fashion and accessories, complemented by children, home, information technology, sundry and services, as well as more than 90 food and beverage outlets. The mall will also have more than 350 shops.

“We’re targeting the middle and middle-upper segments from neighbouring locations, namely, Kajang, Seri Kembangan, Bangi, Puchong, Bukit Jalil, Putrajaya, Cyberjaya and Sri Petaling,” said Chong.


He pointed out that there were many malls in the northern and central regions of the Klang Valley, but hardly any in the southern areas.


“The closest malls to us are Alamanda (Putrajaya) and Mines (Seri Kembangan). People from Seremban also go to these malls due to limited retail options there.


“Our mall, once completed, would be just half-an-hour away from Seremban.”


Two 30-storey office towers and a 23-storey, five-star hotel is also being built adjacent to the mall. Construction of the towers and the hotel is scheduled for completion in 2015 and 2016, respectively.

Chong said one of the biggest challenges faced with the conceptualisation of the mall was to be able to attract retailers.

“When we first started, the challenge was to convince retailers to invest. But the southern part of the Klang Valley is largely untapped (in terms of mall presence) and we told them (the retailers) that there was a lot of potential here.”

Around RM200mil had been invested to develop the surrounding infrastructure of the mall, Chong said, adding: “These include roads, a flyover and tunnels into the mall.”


He said talks were also ongoing with bus operators to expand their routes around the mall area.


16/01/2014

IOI Properties Group Bhd, Bursa Malaysia’s stock debutant for the year, made a strong maiden appearance with a hefty 70-sen premium over its reference price of RM2.51, making it one of the largest property companies on the local bourse with a market capitalisation of over RM10bil.


At the opening bell, IOI Properties surged to RM3.21, hitting a high of RM3.56 within minutes of trading. The stock closed up 64 sen, or 25.49%, at RM3.15.


IOI Group founder Tan Sri Lee Shin Cheng said that market capitalisation was not that crucial and that he would be focusing on the company’s sustainability and growth.


“Having the biggest market capitalisation is not important, the company’s growth and sustainability is more important,” he said after the listing of IOI Properties.


Shin Cheng said the company was looking at more long-term property investments and was also eyeing the overseas market to transform itself into a multinational property entity.


He added that the company’s mega projects included IOI Resort City in Putrajaya, South Beach Development in Singapore and IOI Palm City in Xiamen, China.


The projects are expected to have a gross development value of RM10.7bil upon completion.

“What matters most for us is sustainable growth,” IOI Properties chief executive officer Lee Yeow Seng said.

Yeow Seng said the company was expecting annual sales of up to RM3bil for the next three financial years ending June 30, 2016, with property launches in Malaysia, Singapore and China.


He said it would be a challenging year in 2014 due to the Government’s several cooling measures.

“Nevertheless, we are very positive due to our diversity in geographical locations and the different market segments we serve in Malaysia, Singapore and China,” he said, adding that the company was always on the lookout for new investment opportunities.


On its dividend policy, Yeow Seng said the company would pay more dividends if it made more profits.

RHB Research has a “buy” call on the stock, with a fair value of RM3.50. It said IOI Properties’ massive township developments – a segment less vulnerable to sectoral cooling measures – would provide the company with sustainable sales.


“IOI’s backing has benefited IOI Properties, with an easier source of land bank and high margins for property developments. Future value would be unlocked via a pool of investment assets worth more than RM2bil,” it said.

The research outfit pointed out that given IOI Properties’ RM8.1bil market capitalisation at listing, the company was qualified to be on investors’ radar screens.


15/01/2014

KUALA LUMPUR: IOI Properties Group Bhd, which was Bursa Malaysia’s first listing of 2014, made a strong debut on Wednesday when it opened at RM3.21, which was a hefty 70 sen above its reference price of RM2.51.

At 9.01am, it was trading at RM3.44. There were 1.95 million shares traded at prices ranging from RM3.21 to RM3.50.

The FBM KLCI fell 7.57 points to 1,827.40. There were 70.01 million shares done valued at RM52.11mil. There were 130 gainers, 63 losers and 156 counters unchanged.


RHB Research has a Buy with a fair value of RM3.50. It said IOI Properties massive township developments – a segment less vulnerable to sector cooling measures – would provide the company with sustainable sales.

“IOI’s backing has benefited IOI Properties, with an easier source of landbank and high margins for property developments. Future value will be unlocked via a pool of investment assets worth more than RM2bil,” it said.

RHB Research pointed out that given IOI Properties RM8.1bil market capitalisation at listing, the company was qualified to be on investors’ radar screens.

 

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

04-3907818

Match

:

N/A

Address Provided by Client

:

2411,LORONG PERUSAHAAN SATU, PRAI INDUSTRIAL COMPLEX,13600,PRAI,PULAU PINANG.

Current Address

:

2411,LORONG PERUSAHAAN SATU, PRAI INDUSTRIAL COMPLEX, 13600 PRAI, PULAU PINANG, MALAYSIA.

Match

:

YES

Latest Financial Accounts

:

YES

 

Other Investigations


On 18th March 2014 we contacted one of the staff from the subject and she provided some information.


FINANCIAL ANALYSIS

 

 

Profitability

Turnover

:

Decreased

[

12.40%

]

Profit/(Loss) Before Tax

:

Increased

[

124.30%

]

Return on Shareholder Funds

:

Favourable

[

44.76%

]

Return on Net Assets

:

Favourable

[

59.26%

]

The lower turnover could be due to the intense market competition.The Subject's management have been efficient in controlling its operating costs. Generally the Subject was profitable. The favourable return on shareholders' funds and return on net assets indicate that the Subject's management was efficient in utilising the assets to generate returns.

Working Capital Control

Stock Ratio

:

Favourable

[

29 Days

]

Debtor Ratio

:

Favourable

[

27 Days

]

Creditors Ratio

:

Favourable

[

3 Days

]

The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in 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

[

2.81 Times

]

Current Ratio

:

Favourable

[

4.03 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

[

113.21 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 :

Due to the efficient control of its operating costs, the Subject was able to remain profitable despite lower turnover achieved during the year. 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



INDUSTRY ANALYSIS

 

MSIC CODE

202 : Manufacture of other chemical products

INDUSTRY :

MANUFACTURING

The Manufacturing sector is one of the important sectors to the growth of the Malaysian economy. According to Ministry of Finance, the manufacturing sector is expected to grow 4.9% in year 2013. Export oriented-industries are expected to benefit from the higher growth of global trade, while domesticoriented industries expand in line with the better consumer sentiment and business confidence. The resource-based industries are envisaged to grow steadily attributed to improved demand for petroleum, chemical, rubber and plastic products. With better job prospects and higher disposable income, the transportation equipment subsector, in particular, the passenger car segment is expected to expand.

Value-added of the manufacturing sector expanded 5% during the first half of 2012. Output of the sector rose 5.2% during the first sevenmonths of 2012 in line with the increase in sales value of manufactured products by 6.5% to RM363.1 billion. Output from domesticoriented industries continued to expand 8.6% while export-oriented industries grew 4.1%.

According to the Department of Statistics, the sales value of the Manufacturing sector in January 2013 posted a growth of 7.4% (RM3.6 billion) to record RM52.4 billion as compared to RM48.8 billion reported in year 2012. Meanwhile, month-on-month basis, the sales value has decreased by 0.4% (RM0.2 billion) as compared with the preceding month. The sales value in December 2012 has been revised positive 7.5% year-on-year to record RM52.6 billion.

Output of rubber products increased 3.6% in the first seven month of 2012 mainly supported by continuous demand for rubber gloves. Output of rubber gloves grew 5.9% on account of the expansion in the global healthcare industry and wider usage of gloves in other sectors. Similarly, output of catheters, especially for use in medical appliances, also registered a strong growth of 12.6%. Nevertheless, production of rubber tyres and tubes reduced 10.9% in tandem with slowing external demand from the automotive industry, especially China.

Meanwhile, production of wood and wood products rebounded 4.6% largely supported by higher demand for wooden and cane furniture (33.5%). The positive performance was attributed to vibrant higher demand from major export destinations such as China and the United States (US) for Malaysian-made furniture. Demand from China accelerated further following the country’s rising income level and the implementation of zero import duty on Malaysian made-furniture. Malaysia government has growth target of 6.5% for wood based furniture where estimated to reach up to RM53 billion by year 2020.The government providing pioneer status for tax exemption and investment tax allowance for this industry as a boost up step towards produce good quality product and to meet the world demand.

The output of chemicals and chemical products rose 9.9% in the first seven month of year 2012 on account of increasing demand for plastic products (11.8%) and basic chemicals (11.1%). External demand for plastic packaging materials surged during the early part of the year 2012, particularly from Japan and Thailand, as manufacturers resumed operations, which were interrupted by natural calamities and power outages. Chemical production are expected to show 7.5 % in year 2013 inline with Malaysia as one of the largest contributor in world Chemicals & Chemical industries.

Tax and non-tax incentives provided by goverment encourage manufacturers to move up the value chain of manufacturing industry. The new growth initiatives by goverment in the manufacturing sector such assolar and medial services can be important drivers of growth apart from helping to diversify the manufacturing base and contributing to the resilience of the sector.

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 1983, the Subject is a Private Limited company, focusing on manufacture of fatty acids and glycerine. The Subject has been in business for over 3 decades. It has built up a strong clientele base and good reputation will enable the Subject to further enhance its business in the near term.  The Subject is expected to enjoy a stable market shares. Having a strong shareholders' backing , the Subject has the advantage to compete with its rivals and it is expected to enjoy timely financial assistance should the needs arise. 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 penetrated into both the local and overseas market. The Subject has positioned itself in the global market and is competing in the industry. Its stable clientele base will enable the Subject to further enhance its business in the near term. Being a large entity, the Subject has a steady workforce of 650 personnel to support its business operations. Its future prospects seem to be fairly good as its business operations are running relatively stable. 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. To improve its quality products and services, we noted that the Subject has received a number of certifications & awards. This will improve the customer's confidence level to the Subject


Despite the lower turnover, the Subject's pre-tax profit have increased compared to the previous year. The higher profit could be due to better control of its operating costs and efficiency in utilising its resources. Based on the higher profitability, the Subject has generated a favourable return based on its existing shareholders' funds 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 348,996,456, 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 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)

 

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

GROUP

GROUP

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

1,351,898,903

1,543,322,550

1,666,014,734

1,289,038,502

1,266,511,490

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

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

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

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

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

Total Turnover

1,351,898,903

1,543,322,550

1,666,014,734

1,289,038,502

1,266,511,490

Costs of Goods Sold

(1,009,129,114)

(1,309,724,547)

(1,511,981,783)

(1,069,380,910)

-

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

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

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

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

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

Gross Profit

342,769,789

233,598,003

154,032,951

219,657,592

-

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

212,774,090

94,861,677

19,351,123

84,466,698

98,116,121

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

212,774,090

94,861,677

19,351,123

84,466,698

98,116,121

Taxation

(56,559,003)

(23,236,708)

(4,532,780)

(20,083,803)

(16,665,127)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

156,215,087

71,624,969

14,818,343

64,382,895

81,450,994

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

326,942,380

315,317,411

503,261,757

438,878,862

447,427,868

Prior year adjustment

-

-

3,341,627

-

-

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

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

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

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

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

As restated

326,942,380

315,317,411

506,603,384

438,878,862

447,427,868

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

483,157,467

386,942,380

521,421,727

503,261,757

528,878,862

DIVIDENDS - Ordinary (paid & proposed)

(154,000,000)

(60,000,000)

(209,169,797)

-

(90,000,000)

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

329,157,467

326,942,380

312,251,930

503,261,757

438,878,862

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Bankers' acceptance

-

-

467,373

-

-

Lease interest

1,896,290

91,368

106,319

-

-

Loan from holding company

-

3,717,487

355,304

-

-

Others

-

-

-

26,468

56,763

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

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

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

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

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

1,896,290

3,808,855

928,996

26,468

56,763

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

 

ASSETS EMPLOYED:

FIXED ASSETS

97,703,315

110,228,694

132,137,774

149,484,431

165,290,736

LONG TERM INVESTMENTS/OTHER ASSETS

Subsidiary companies

-

-

1,536,464

83,203

83,203

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

-

-

1,536,464

83,203

83,203

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

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

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

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

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

TOTAL LONG TERM ASSETS

97,703,315

110,228,694

133,674,238

149,567,634

165,373,939

CURRENT ASSETS

Stocks

106,322,354

144,279,239

198,204,922

112,809,829

78,134,577

Trade debtors

99,236,599

114,185,463

187,234,930

132,889,191

71,730,496

Other debtors, deposits & prepayments

2,483,196

1,167,526

1,692,171

261,457,895

193,795

Short term deposits

10,190,840

15,128,047

11,830,352

16,553,200

20,205,123

Amount due from holding company

-

-

154,431

-

179,450,655

Amount due from subsidiary companies

-

-

623,694

-

9,500,691

Amount due from related companies

37,577,394

10,555,975

2,500

-

11,036,544

Amount due from associated companies

21,016,496

36,993,884

-

-

31,222,561

Cash & bank balances

17,364,975

97,791,105

1,906,699

5,002,434

3,372,336

Others

57,763,974

35,534,942

7,924,882

-

753,000

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

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

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

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

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

TOTAL CURRENT ASSETS

351,955,828

455,636,181

409,574,581

528,712,549

405,599,778

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

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

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

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

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

TOTAL ASSET

449,659,143

565,864,875

543,248,819

678,280,183

570,973,717

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

9,375,697

3,244,163

72,104,390

99,207,419

15,662,543

Other creditors & accruals

33,986,056

24,201,007

24,433,295

29,866,272

24,849,438

Hire purchase & lease creditors

-

185,533

-

24,691

-

Amounts owing to holding company

1,141,301

129,902,405

91,643,709

-

-

Amounts owing to related companies

26,971,373

35,262,627

24,540

-

40,305,831

Amounts owing to associated companies

-

-

-

-

3,398,067

Provision for taxation

8,447,082

7,260,424

-

-

-

Lease payables

-

-

133,377

-

-

Other liabilities

7,469,280

5,444,776

1,061,805

1,811,584

-

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

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

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

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

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

TOTAL CURRENT LIABILITIES

87,390,789

205,500,935

189,401,116

130,909,966

84,215,879

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

264,565,039

250,135,246

220,173,465

397,802,583

321,383,899

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

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

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

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

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

TOTAL NET ASSETS

362,268,354

360,363,940

353,847,703

547,370,217

486,757,838

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

20,000,000

20,000,000

20,000,000

20,000,000

20,000,000

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

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

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

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

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

TOTAL SHARE CAPITAL

20,000,000

20,000,000

20,000,000

20,000,000

20,000,000

RESERVES

Exchange equalisation/fluctuation reserve

(511,011)

(498,121)

-

-

-

Retained profit/(loss) carried forward

329,157,467

326,942,380

312,251,930

503,261,757

438,878,862

Capital redemption reserve

350,000

350,000

350,000

350,000

350,000

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

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

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

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

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

TOTAL RESERVES

328,996,456

326,794,259

312,601,930

503,611,757

439,228,862

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

348,996,456

346,794,259

332,601,930

523,611,757

459,228,862

LONG TERM LIABILITIES

Lease obligations

-

287,422

318,302

106,729

-

Deferred taxation

7,691,216

7,771,819

15,399,000

18,283,000

22,068,000

Retirement benefits provision

5,480,682

5,210,440

-

-

4,560,976

Others

100,000

300,000

5,528,471

5,368,731

900,000

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

13,271,898

13,569,681

21,245,773

23,758,460

27,528,976

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

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

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

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

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

362,268,354

360,363,940

353,847,703

547,370,217

486,757,838

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

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

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

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

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

 

 

FINANCIAL RATIO

 

 

 

TYPES OF FUNDS

Cash

27,555,815

112,919,152

13,737,051

21,555,634

23,577,459

Net Liquid Funds

27,555,815

112,919,152

13,737,051

21,555,634

23,577,459

Net Liquid Assets

158,242,685

105,856,007

21,968,543

284,992,754

243,249,322

Net Current Assets/(Liabilities)

264,565,039

250,135,246

220,173,465

397,802,583

321,383,899

Net Tangible Assets

362,268,354

360,363,940

353,847,703

547,370,217

486,757,838

Net Monetary Assets

144,970,787

92,286,326

722,770

261,234,294

215,720,346

BALANCE SHEET ITEMS

Total Borrowings

0

472,955

318,302

131,420

0

Total Liabilities

100,662,687

219,070,616

210,646,889

154,668,426

111,744,855

Total Assets

449,659,143

565,864,875

543,248,819

678,280,183

570,973,717

Net Assets

362,268,354

360,363,940

353,847,703

547,370,217

486,757,838

Net Assets Backing

348,996,456

346,794,259

332,601,930

523,611,757

459,228,862

Shareholders' Funds

348,996,456

346,794,259

332,601,930

523,611,757

459,228,862

Total Share Capital

20,000,000

20,000,000

20,000,000

20,000,000

20,000,000

Total Reserves

328,996,456

326,794,259

312,601,930

503,611,757

439,228,862

LIQUIDITY (Times)

Cash Ratio

0.32

0.55

0.07

0.16

0.28

Liquid Ratio

2.81

1.52

1.12

3.18

3.89

Current Ratio

4.03

2.22

2.16

4.04

4.82

WORKING CAPITAL CONTROL (Days)

Stock Ratio

29

34

43

32

23

Debtors Ratio

27

27

41

38

21

Creditors Ratio

3

1

17

34

5

SOLVENCY RATIOS (Times)

Gearing Ratio

0.00

0.00

0.00

0.00

0.00

Liabilities Ratio

0.29

0.63

0.63

0.30

0.24

Times Interest Earned Ratio

113.21

25.91

21.83

3,192.28

1,729.52

Assets Backing Ratio

18.11

18.02

17.69

27.37

24.34

PERFORMANCE RATIO (%)

Operating Profit Margin

15.74

6.15

1.16

6.55

7.75

Net Profit Margin

11.56

4.64

0.89

4.99

6.43

Return On Net Assets

59.26

27.38

5.73

15.44

20.17

Return On Capital Employed

59.26

27.37

5.73

15.44

20.17

Return On Shareholders' Funds/Equity

44.76

20.65

4.46

12.30

17.74

Dividend Pay Out Ratio (Times)

0.99

0.84

14.12

0.00

1.10

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0



FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.61.05

UK Pound

1

Rs.100.81

Euro

1

Rs.84.18

 

 

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.