MIRA INFORM REPORT

 

 

Report Date :

15.11.2014

 

IDENTIFICATION DETAILS

 

Name :

EMERY OLEOCHEMICALS (M) SDN. BHD.

 

 

Formerly Known As :

COGNIS OLEOCHEMICALS (M) SDN BHD
HENKEL OLEOCHEMICALS (MALAYSIA) SDN BHD

 

 

Registered Office :

Building E, Peremba Square, Saujana Resort, Section U2, Level 5, 40150 Shah Alam, Selangor

 

 

Country :

Malaysia

 

 

Financials (as on) :

06.10.1980

 

 

Date of Incorporation :

31.12.2013

 

 

Com. Reg. No.:

63112-D

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Subject is principally engaged in the production and sale of fatty acids, fatty alcohols and refined glycerine oil field chemicals, ozone acids and plastic additives.

 

 

No of Employees :

400 [2014]

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

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 – June 1, 2014

 

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

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 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.

:

63112-D

COMPANY NAME

:

EMERY OLEOCHEMICALS (M) SDN. BHD.

FORMER NAME

:

COGNIS OLEOCHEMICALS (M) SDN BHD (12/05/2009)
HENKEL OLEOCHEMICALS (MALAYSIA) SDN BHD (16/09/1999)

INCORPORATION DATE

:

06/10/1980

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

BUILDING E, PEREMBA SQUARE, SAUJANA RESORT, SECTION U2, LEVEL 5, 40150 SHAH ALAM, SELANGOR, MALAYSIA.

BUSINESS ADDRESS

:

LOT 4, JALAN PERAK, KAWASAN PERUSAHAAN TELOK PANGLIMA GARANG, 42500 TELOK PANGLIMA GARANG, SELANGOR, MALAYSIA.

TEL.NO.

:

03-33268686

FAX.NO.

:

03-33268787

WEB SITE

:

WWW.EMERYOLEO.COM

CONTACT PERSON

:

KONGKRAPAN INTARAJANG ( CEO )

INDUSTRY CODE

:

20299

PRINCIPAL ACTIVITY

:

PRODUCTION AND SALE OF FATTY ACIDS, FATTY ALCOHOLS AND REFINED GLYCERINE OIL FIELD CHEMICALS, OZONE ACIDS AND PLASTIC ADDITIVES

AUTHORISED CAPITAL

:

MYR 500,000,000.00 DIVIDED INTO

ORDINARY SHARE 500,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 430,612,000.00 DIVIDED INTO

ORDINARY SHARES 430,612,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 2,830,207,000 [2013]

NET WORTH

:

MYR 965,851,000 [2013]

M1000 OVERALL RANKING

:

147[2011]

M1000 INDUSTRY RANKING

:

3[2011]

STAFF STRENGTH

:

400 [2014]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

LIMITED

PAYMENT

:

AVERAGE

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) production and sale of fatty acids, fatty alcohols and refined glycerine oil field chemicals, ozone acids and plastic additives.

 

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

147

89

94

321

387

INDUSTRY RANKING

3

2

2

15

12

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

12/12/2012

MYR 500,000,000.00

MYR 430,612,000.00

17/06/2006

MYR 500,000,000.00

MYR 400,000,000.00

18/12/1998

MYR 100,000,000.00

MYR 74,750,000.00

24/04/1996

MYR 100,000,000.00

MYR 54,750,000.00

16/04/1990

MYR 50,000,000.00

MYR 34,750,000.00

20/12/1989

MYR 50,000,000.00

MYR 26,500,000.00

 

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

 

Name

Address

IC/PP/Loc No

Shareholding

(%)

SIME DARBY PLANTATION SDN. BHD.

MAIN BLOCK, PLANTATION TOWER, 2, JALAN PJU 1A/7, ARA DAMANSARA, LEVEL 10, 47301 PETALING JAYA, SELANGOR, MALAYSIA.

647766V

215,306,000.00

50.00

PTT CHEMICAL INTERNATIONAL PRIVATE LIMITED

391A, ORCHARD ROAD, 12-01/04, NGEE ANN CITY TOWER A, 238873, SINGAPORE.

200813882

215,306,000.00

50.00

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

------

430,612,000.00

100.00

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

=====

 

+ Also Director

 

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

Local No

Country

Company

(%)

As At

UNITED STATES

EMERY OLEOCHEMICALS LLC

100.00

31/12/2013

CANADA

EMERY OLEOCHEMICALS CANADA LTD

100.00

31/12/2013

JAPAN

EMERY OLEOCHEMICALS JAPAN LTD

100.00

31/12/2013

GERMANY

EMERY OLEOCHEMICALS GMBH

100.00

31/12/2013

HONG KONG

EMERY OLEOCHEMICALS (HK) LIMITED

100.00

31/12/2013

215324V

MALAYSIA

EMERYOLEO SPECIALTIES (M) SDN. BHD.

100.00

29/03/2013

UNITED KINGDOM

EMERY OLEOCHEMICALS UK LTD

100.00

31/12/2013

93282T

MALAYSIA

EMERY OLEOCHEMICALS RIKA (M) SDN. BHD.

55.00

29/03/2013

 

 

DIRECTORS


DIRECTOR 1

 

Name Of Subject

:

KORNKAMOL KORPAISARN

Address

:

28/22, BAROMRAJCHONNI ROAD, ARUNAMARIN, BANGBAMRU, BANGPLAD, 10900 PULAU PINANG, PULAU PINANG, MALAYSIA.

IC / PP No

:

Y915625

Nationality

:

THAI

Date of Appointment

:

06/07/2012

 

DIRECTOR 2

 

Name Of Subject

:

MR. SHARIMAN ALWANI BIN MOHAMED NORDIN

Address

:

151-2-2, MENARA DUTA, JALAN DUTAMAS RAYA, SEGAMBUT, 51200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A1366525

New IC No

:

690921-03-5365

Date of Birth

:

21/09/1969

Nationality

:

MALAYSIAN

Date of Appointment

:

27/02/2014

 

DIRECTOR 3

 

Name Of Subject

:

VANCHAI TADADOLTIP

Address

:

5/103 MOO 3, TAB-MA ROAD, NERNPRA, AMPHOE MUANG, RAYONG 21000, THAILAND, THAILAND.

IC / PP No

:

L863657

Nationality

:

THAI

Date of Appointment

:

16/01/2012

 

DIRECTOR 4

 

Name Of Subject

:

MS. RENAKA A/P RAMACHANDRAN

Address

:

19, JALAN ENDAH 6/7, 46000 PETALING JAYA, SELANGOR, MALAYSIA.

IC / PP No

:

A0821952

New IC No

:

671005-10-6080

Date of Birth

:

05/10/1967

Nationality

:

MALAYSIAN

Date of Appointment

:

06/09/2011

 

DIRECTOR 5

 

Name Of Subject

:

MR. FRANKI A/L ANTHONY DASS

Address

:

3 JALAN 3/66, SECTION 3, 46000 PETALING JAYA, SELANGOR, MALAYSIA.

New IC No

:

561002-07-5533

Date of Birth

:

02/10/1956

Nationality

:

MALAYSIAN

Date of Appointment

:

06/12/2010

 

DIRECTOR 6

 

Name Of Subject

:

PUNTIP OUNGPASUK

Address

:

114/99 LADDAROM, VILLAGE SOI 7, SAINA, MUANG, NONTHABURI 11000, THAILAND, THAILAND.

IC / PP No

:

W827327

Nationality

:

THAI

Date of Appointment

:

24/11/2008

 

DIRECTOR 7

 

Name Of Subject

:

DATO' KONGKRAPAN INTARAJANG

Address

:

38/17, SIO SOON VIJAI 6, NEW PHBURI ROAD BANGKAPAI, HUI KHWANG BANGKOK 10320, THAILAND, THAILAND.

IC / PP No

:

A932762

Nationality

:

THAI

Date of Appointment

:

24/11/2008

 

DIRECTOR 8

 

Name Of Subject

:

MR. MUSTAMIR BIN MOHAMAD

Address

:

9, JALAN ARA SD 7/1B, BANDAR SRI DAMANSARA, 52200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A1836639

New IC No

:

720518-10-5399

Date of Birth

:

18/05/1972

Nationality

:

MALAYSIAN

Date of Appointment

:

01/02/2012

 


DIRECTOR 9

 

Name Of Subject

:

MR. ZULKIFLEE BIN ABDUL RAHMAN

Address

:

30, JALAN SUNGAI BERANANG 32/57, BUKIT RIMAU, SECTION 32, 40460 SHAH ALAM, SELANGOR, MALAYSIA.

IC / PP No

:

A0422566

New IC No

:

660720-01-6371

Date of Birth

:

20/07/1966

Nationality

:

MALAYSIAN

Date of Appointment

:

27/02/2014

 

DIRECTOR 10

 

Name Of Subject

:

ANON SIRISAENGTAKSIN

Address

:

42 SOI INTRAMARA 1, SUTHISARNVINIJCHAI ROAD, SAMSENNAI, PHAYATHAI, BANGKOK 10330, THAILAND, THAILAND.

IC / PP No

:

F545107

Nationality

:

THAI

Date of Appointment

:

06/07/2012

 

 

MANAGEMENT

 

 

1)

Name of Subject

:

KONGKRAPAN INTARAJANG

Position

:

CEO

 

 

AUDITOR

 

Auditor

:

ERNST & YOUNG

Auditor' Address

:

MENARA MILENIUM, JALAN DAMANLELA, PUSAT BANDAR DAMANSARA, LEVEL 23A, 50490 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. SHAH RIZAL BIN NOOR IKHSAN

IC / PP No

:

A1073204

New IC No

:

680827-01-5393

Address

:

170, JALAN A10, TAMAN MELAWATI, HULU KLANG, 53100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

24/09/1982

N/A

EUROPEAN ASIAN BANK AKTIENGESELLSCHFT

-

Satisfied

2

22/12/1983

N/A

DEUTSCHE BANK MALAYSIA BHD

MYR 10,000,000.00

Satisfied

3

03/03/1989

N/A

DEUTSCHE BANK MALAYSIA BHD

MYR 10,000,000.00

Satisfied

4

11/03/1989

N/A

DEUTSCHE BANK MALAYSIA BHD

MYR 9,850,000.00

Satisfied

5

17/04/1989

N/A

DEUTSCHE BANK MALAYSIA BHD

MYR 9,850,000.00

Satisfied

6

10/05/1989

N/A

UNITED ASIAN BANK BERHAD

MYR 9,850,000.00

Satisfied

7

04/12/1989

N/A

UNITED ASIAN BANK BERHAD

MYR 9,850,000.00

Satisfied

8

02/01/1990

N/A

UNITED ASIAN BANK BERHAD

MYR 3,420,000.00

Satisfied

9

02/01/1990

N/A

DEUTSCHE BANK MALAYSIA BHD

MYR 2,240,000.00

Satisfied

 

 

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 it' suppliers.

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

[

]

Good 31-60 Days

[

]

Average 61-90 Days

[

X

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

EUROPE

ASIA

MIDDLE EAST

ASIA PACIFIC

NORTH AMERICA

Credit Term

:

N/A

Payment Mode

:

N/A

Type of Customer

:

CHEMICAL INDUSTRY

 

 

OPERATIONS

 

Products manufactured

:

FATTY ACID, OILFIELD CHEMICAL, FATTY ALCOHOL, OZONE ACID, GLYCERINE & TRIACETINE AND PLASTIC ADDITIVE

Award

:

1 ) HACCP Year :2005
2 ) MS ISO 14001 Year :2001
3 ) MS ISO 9001 : 2000 Year :1997

Competitor(s)

:

BP CHEMICALS (MALAYSIA) SDN. BHD.
KL-KEPONG OLEOMAS SDN. BHD.
NATURAL OLEOCHEMICALS SDN BHD
NYLEX (MALAYSIA) BHD
PETRONAS CHEMICALS GROUP BHD

Member(s) / Affiliate(s)

:

MALAYSIAN CROP CARE AND PUBLIC HEALTH ASSOCIATION (MCPA)

FEDERATION OF MALAYSIAN MANUFACTURERS (FMM)

SMI ASSOCIATION OF MALAYSIA

SMALL & MEDIUM ENTERPRISE

CHEMICAL INDUSTRIES COUNCIL OF MALAYSIA (CICM)

Ownership of premises

:

OWNED

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010


GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

400

400

350

550

550

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) production and sale of fatty acids, fatty alcohols and refined glycerine oil field chemicals, ozone acids and plastic additives.


The Subject's products are derived from renewable resources which predominantly made from natural oils and fats such as palm kernel oil and tallow.


The Subject is dedicated to providing customers with best-in-class solutions through continuous product development and stringent quality standards by offering products from basics to semi-specialty and specialty chemicals.

The Subject's natural based solutions was being recognized as industry standard due to the high qualities and product excellence.

 

 

RECENT DEVELOPMENT


15th October 2013

The SC recently opened a new Technical Development Centre (TDC) which based in Loxstedt, Germany. This is because the SC wishes to reach sustainable innovations to strengthen their competitive advantage and address consumer expectations. Therefore, TDC will serve as the SC’s Global Centre of Excellence for its Green Polymer Additives business.


11th October 2013

The SC is pleased to announce that two of its existing products, namely EMEREEN™ 3916 - Glycerine 99.7% USP and EMEREEN™ 3912 - Glycerine 96% USP have been approved by the Organic Material Review Institute (OMRI Listed ®) for use in certified organic production and in food processing and handling.In gaining recognition as the first commercially produced organic Glycerine solutions for the agricultural industry; the accreditation makes the SC the only natural-based chemicals manufacturing company to offer OMRI Listed® Glycerine.

 

CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-33268686

Match

:

N/A

Address Provided by Client

:

P O BOX 112, 42507 TELOK RAN GLTMA GARANG SELANGOR

Current Address

:

LOT 4, JALAN PERAK, KAWASAN PERUSAHAAN TELOK PANGLIMA GARANG, 42500 TELOK PANGLIMA GARANG, SELANGOR, MALAYSIA.

Match

:

NO

Latest Financial Accounts

:

YES

 

Other Investigations


On 13th November 2014 we contacted one of the staff from the Subject and she provided some information on the Subject.

 

The Subject is not aware of the address provided.

 

 

FINANCIAL ANALYSIS

 

 

Profitability

Turnover

:

Decreased

[

2009 - 2013

]

Profit/(Loss) Before Tax

:

Decreased

[

2009 - 2013

]

Return on Shareholder Funds

:

Unfavourable

[

2.29%

]

Return on Net Assets

:

Unfavourable

[

(0.95%)

]

The continuous fall in turnover could be due to the lower demand for the Subject's products / services.The Subject incurred losses during the year due to the inefficient control of its operating costs. 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

:

Acceptable

[

61 Days

]

Debtor Ratio

:

Favourable

[

46 Days

]

Creditors Ratio

:

Favourable

[

40 Days

]

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

:

Acceptable

[

0.82 Times

]

Current Ratio

:

Unfavourable

[

1.33 Times

]

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

Solvency

Interest Cover

:

Unfavourable

[

(0.46 Times)

]

Gearing Ratio

:

Favourable

[

0.74 Times

]

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

Overall Assessment :

The Subject's losses could be attributed to the lower turnover which in turn could be the result of unfavourable market conditions. The Subject's liquidity was at an acceptable range. If the Subject is able to obtain further short term financing, it should be able to meet all its short term obligations. The Subject's interest cover was negative, indicating that it did not generate sufficient income to service its interest. If its result does not show impressive improvements or succeed obtaining short term financing or capital injection, it may not be able to service its interest and repay the loans. The Subject as a lowly geared company, will be more secured compared to those highly geared companies. It has the ability to meet all its long term obligations.

Overall financial condition of the Subject : LIMITED

 

 

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

 

Major Economic Indicators:

2010

2011

2012

2013

2014**

Population ( Million)

28.35

28.70

29.30

29.80

30.30

Gross Domestic Products ( % )

7.2

5.1

5.6

5.3

6.0

Domestic Demand ( % )

6.3

8.2

9.4

5.6

6.4

Private Expenditure ( % )

8.1

8.2

8.0

7.4

7.9

Consumption ( % )

6.7

7.1

1.0

5.7

6.5

Investment ( % )

17.7

12.2

11.7

13.3

12.0

Public Expenditure ( % )

3.8

8.4

13.3

1.2

2.3

Consumption ( % )

0.2

16.1

11.3

(1.2)

2.1

Investment ( % )

2.8

(0.3)

15.9

4.2

2.6

Balance of Trade ( MYR Million )

118,356

116,058

106,300

110,700

52,314

Government Finance ( MYR Million )

(40,482)

(45,511)

(42,297)

(39,993)

(37,291)

Government Finance to GDP / Fiscal Deficit ( % )

(5.6)

(5.4)

(4.5)

(4.0)

(3.5)

Inflation ( % Change in Composite CPI)

5.1

3.1

1.6

2.5

3.3

Unemployment Rate

3.9

3.3

3.2

3.0

3.0

Net International Reserves ( MYR Billion )

329

415

427

-

417

Average Risk-Weighted Capital Adequacy Ratio ( % )

2.20

3.50

2.20

-

-

Average 3 Months of Non-performing Loans ( % )

15.30

14.80

14.70

-

-

Average Base Lending Rate ( % )

6.30

6.60

6.53

6.53

-

Business Loans Disbursed( % )

14.7

15.3

32.2

-

-

Foreign Investment ( MYR Million )

22,517.9

23,546.1

26,230.4

38,238.0

-

Consumer Loans ( % )

-

-

-

-

-

Registration of New Companies ( No. )

44,148

45,455

45,441

46,321

-

Registration of New Companies ( % )

6.2

3.0

(0.0)

1.9

-

Liquidation of Companies ( No. )

25,585

132,476

-

-

-

Liquidation of Companies ( % )

(34.5)

417.8

-

-

-

Registration of New Business ( No. )

271,414

284,598

324,761

329,895

-

Registration of New Business ( % )

-

-

-

-

-

Business Dissolved ( No. )

19,738

20,121

-

-

-

Business Dissolved ( % )

2.0

1.9

-

-

-

Sales of New Passenger Cars (' 000 Unit )

543.6

535.1

552.2

-

-

Cellular Phone Subscribers ( Million )

32.8

35.3

38.5

43.0

-

Tourist Arrival ( Million Persons )

24.6

24.7

25.0

25.7

-

Hotel Occupancy Rate ( % )

63.0

60.6

62.4

62.6

-

Credit Cards Spending ( % )

14.1

15.6

12.6

-

-

Bad Cheque Offenders (No.)

33,568

32,627

26,982

28,876

-

Individual Bankruptcy ( No.)

18,119

19,167

19,575

21,984

-

Individual Bankruptcy ( % )

11.7

5.8

2.1

12.3

-

 

 

INDUSTRIES ( % of Growth ):

2010

2011

2012

2013

2014**

Agriculture

2.4

5.8

1.0

2.1

3.8

Palm Oil

(3.4)

10.8

(0.3)

2.6

-

Rubber

9.9

6.1

(7.9)

(10.1)

-

Forestry & Logging

(3.3)

(7.6)

(4.5)

(7.8)

-

Fishing

5.6

2.1

4.3

1.6

-

Other Agriculture

7.9

7.1

6.4

8.2

-

Industry Non-Performing Loans ( MYR Million )

508.4

634.1

-

-

-

% of Industry Non-Performing Loans

2.1

3.2

-

-

-

Mining

(0.3)

(5.4)

1.4

0.9

(0.8)

Oil & Gas

0.5

(1.7)

-

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

49.7

46.5

-

-

-

% of Industry Non-performing Loans

0.1

0.1

-

-

-

Manufacturing #

11.9

4.7

4.8

3.4

6.6

Exported-oriented Industries

12.1

4.1

6.5

3.3

5.6

Electrical & Electronics

28.4

(4.0)

12.7

6.9

13.3

Rubber Products

25.3

20.7

3.0

11.7

(0.3)

Wood Products

20.1

(5.1)

8.7

(2.7)

5.1

Textiles & Apparel

(0.4)

13.2

(7.1)

(2.6)

11.5

Domestic-oriented Industries

16.3

10.7

1.7

6.8

9.4

Food, Beverages & Tobacco

3.0

4.8

2.7

3.6

6.1

Chemical & Chemical Products

16.2

10.0

10.8

5.6

-

Plastic Products

2.4

3.8

-

-

-

Iron & Steel

29.3

2.2

(6.6)

5.0

0.1

Fabricated Metal Products

14.9

21.8

13.8

9.9

2.9

Non-metallic Mineral

20.2

12.1

2.9

(2.0)

5.4

Transport Equipment

36.5

12.0

3.4

13.8

22.9

Paper & Paper Products

18.7

9.5

3.1

1.8

4.7

Crude Oil Refineries

(11.4)

9.3

-

-

-

Industry Non-Performing Loans ( MYR Million )

6,217.5

6,537.2

-

-

-

% of Industry Non-Performing Loans

23.8

25.7

-

-

-

Construction

11.4

4.7

18.6

10.9

10.0

Industry Non-Performing Loans ( MYR Million )

4,038.5

3,856.9

-

-

-

% of Industry Non-Performing Loans

10.7

10.2

-

-

-

Services

7.4

7.0

6.4

5.9

6.2

Electric, Gas & Water

7.8

3.5

4.4

4.2

3.6

Transport, Storage & Communication

7.7

6.5

7.1

7.3

7.5

Wholesale, Retail, Hotel & Restaurant

4.7

5.2

4.7

5.9

6.9

Finance, Insurance & Real Estate

6.10

6.90

9.70

3.70

4.65

Government Services

5.9

12.4

9.4

8.3

6.1

Other Services

4.4

5.1

3.9

5.1

4.8

Industry Non-Performing Loans ( MYR Million )

7,384.6

6,825.2

-

-

-

% of Industry Non-Performing Loans

25.7

23.4

-

-

-

* Estimate / Preliminary

** Forecast

# Based On Manufacturing Production Index

 

 

INDUSTRY ANALYSIS

 

MSIC CODE

20299 : Manufacture of other chemical products n.e.c.

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 1980, the Subject is a Private Limited company, focusing on production and sale of fatty acids, fatty alcohols and refined glycerine oil field chemicals, ozone acids and plastic additives. The Subject has been in business for over two 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. The Subject is a large entity with strong capital position of MYR 430,612,000. We are confident with the Subject's business and its future growth prospect. Having strong support from its shareholders has enabled the Subject to remain competitive despite the challenging business environment.


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. The Subject is a fairly large and rapidly growing company with over 400 staff in its operations 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. 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.


Due to the challenging market conditions, the Subject's business performance seems to be deteriorating and losses incurred. 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 managed to maintain an adequate liquidity level, indicating that the Subject has the ability to meet its financial obligations. Being a lowly geared company, the Subject is exposed to low financial risk as it is mainly dependent on its internal funds to finance its business needs. Given a positive net worth standing at MYR 965,851,000, the Subject should be able to maintain its business in the near terms.


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


The industry shows an upward trend and this trend is very likely to sustain in the near terms. Hence, the 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 normally.

 

 

 

PROFIT AND LOSS ACCOUNT

 

 

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

EMERY OLEOCHEMICALS (M) SDN. BHD.

 

Financial Year End

2013-12-31

2012-12-31

2011-12-31

2010-12-31

2009-12-31

Months

12

12

12

12

12

Consolidated Account

GROUP

GROUP

GROUP

GROUP

GROUP

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

2,830,207,000

3,219,117,000

3,605,403,000

3,114,760,000

2,646,135,000

Other Income

67,547,000

182,379,000

99,327,000

91,143,000

85,601,000

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

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

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

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

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

Total Turnover

2,897,754,000

3,401,496,000

3,704,730,000

3,205,903,000

2,731,736,000

Costs of Goods Sold

(2,466,105,000)

(2,867,539,000)

(3,197,340,000)

(2,651,644,000)

(2,315,571,000)

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

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

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

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

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

Gross Profit

431,649,000

533,957,000

507,390,000

554,259,000

416,165,000

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

(38,440,000)

53,200,000

23,990,000

76,982,000

(34,638,000)

SHARE OF PROFITS/(LOSSES) OF ASSOCIATED COMPANIES

(2,207,000)

(1,165,000)

(377,000)

122,000

(439,000)

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

(40,647,000)

52,035,000

23,613,000

77,104,000

(35,077,000)

Taxation

67,470,000

(11,335,000)

(13,662,000)

(26,780,000)

(289,000)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

26,823,000

40,700,000

9,951,000

50,324,000

(35,366,000)

Minority interests

(4,715,000)

(3,603,000)

(3,587,000)

(3,047,000)

(3,487,000)

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

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

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

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

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

PROFIT/(LOSS) BEFORE EXTRAORDINARY ITEMS

22,108,000

37,097,000

6,364,000

47,277,000

(38,853,000)

Extraordinary items

35,125,000

(39,530,000)

-

-

-

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

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

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

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

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

PROFIT/(LOSS) ATTRIBUTABLE TO SHAREHOLDERS

57,233,000

(2,433,000)

6,364,000

47,277,000

(38,853,000)

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

324,211,000

394,383,000

382,998,000

335,721,000

374,574,000

Prior year adjustment

-

(67,739,000)

5,021,000

-

-

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

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

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

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

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

As restated

324,211,000

326,644,000

388,019,000

335,721,000

374,574,000

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

381,444,000

324,211,000

394,383,000

382,998,000

335,721,000

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

381,444,000

324,211,000

394,383,000

382,998,000

335,721,000

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Lease interest

1,832,000

2,364,000

1,634,000

-

-

Revolving loans

9,863,000

9,835,000

8,038,000

3,708,000

4,186,000

Term loan / Borrowing

-

-

8,717,000

-

-

Others

16,079,000

15,345,000

7,946,000

11,414,000

15,667,000

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

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

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

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

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

27,774,000

27,544,000

26,335,000

15,122,000

19,853,000

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

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

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

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

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

 

 

 

 

 

 

 

 

 

 

 

 

 

BALANCE SHEET

 

 

EMERY OLEOCHEMICALS (M) SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

913,446,000

817,373,000

781,205,000

660,617,000

608,072,000

Associated companies

-

16,035,000

16,035,000

-

-

Investments

210,000

6,044,000

7,386,000

210,000

-

Deferred assets

74,983,000

16,620,000

4,511,000

6,288,000

21,012,000

Others

-

-

-

6,990,000

6,778,000

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

75,193,000

38,699,000

27,932,000

13,488,000

27,790,000

INTANGIBLE ASSETS

Deferred/Expenditure carried forward

-

-

-

23,857,000

19,592,000

Own goodwill

5,959,000

5,566,000

5,821,000

-

-

Patents / Copyrights

10,142,000

9,317,000

16,457,000

-

-

Computer software

-

-

410,000

-

-

Others

36,204,000

1,802,000

3,000

-

-

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

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

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

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

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

TOTAL INTANGIBLE ASSETS

52,305,000

16,685,000

22,691,000

23,857,000

19,592,000

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

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

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

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

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

TOTAL LONG TERM ASSETS

1,040,944,000

872,757,000

831,828,000

697,962,000

655,454,000

Stocks

475,926,000

394,701,000

510,741,000

502,019,000

413,602,000

Trade debtors

359,807,000

395,539,000

454,215,000

440,957,000

401,572,000

Other debtors, deposits & prepayments

108,418,000

21,597,000

39,877,000

18,957,000

21,200,000

Short term deposits

54,220,000

103,417,000

53,579,000

35,746,000

107,625,000

Cash & bank balances

221,332,000

210,108,000

101,985,000

106,732,000

90,579,000

Others

16,751,000

16,246,000

17,506,000

20,311,000

9,667,000

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

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

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

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

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

TOTAL CURRENT ASSETS

1,236,454,000

1,141,608,000

1,177,903,000

1,124,722,000

1,044,245,000

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

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

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

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

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

TOTAL ASSET

2,277,398,000

2,014,365,000

2,009,731,000

1,822,684,000

1,699,699,000

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

271,694,000

181,279,000

233,475,000

235,317,000

224,126,000

Other creditors & accruals

91,261,000

85,077,000

95,625,000

82,242,000

85,357,000

Hire purchase & lease creditors

9,375,000

10,174,000

8,794,000

248,000

303,000

Bank overdraft

6,488,000

461,000

6,746,000

3,823,000

3,205,000

Short term borrowings/Term loans

57,381,000

22,935,000

-

170,979,000

-

Other borrowings

365,569,000

316,261,000

297,232,000

249,149,000

155,504,000

Bill & acceptances payable

90,000,000

115,000,000

117,708,000

45,962,000

-

Provision for taxation

1,531,000

1,122,000

13,399,000

6,491,000

2,234,000

Dividends payable/proposed

-

-

-

-

14,229,000

Other liabilities

34,310,000

33,959,000

14,635,000

8,946,000

913,000

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

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

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

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

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

TOTAL CURRENT LIABILITIES

927,609,000

766,268,000

787,614,000

803,157,000

485,871,000

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

308,845,000

375,340,000

390,289,000

321,565,000

558,374,000

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

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

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

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

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

TOTAL NET ASSETS

1,349,789,000

1,248,097,000

1,222,117,000

1,019,527,000

1,213,828,000

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

430,612,000

430,612,000

400,000,000

400,000,000

400,000,000

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

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

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

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

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

TOTAL SHARE CAPITAL

430,612,000

430,612,000

400,000,000

400,000,000

400,000,000

RESERVES

Share premium

28,578,000

28,578,000

28,578,000

28,578,000

28,578,000

Revaluation reserve

-

-

-

8,094,000

8,052,000

Exchange equalisation/fluctuation reserve

69,551,000

35,081,000

20,373,000

-

-

Retained profit/(loss) carried forward

381,444,000

324,211,000

394,383,000

382,998,000

335,721,000

Others

-

-

-

16,884,000

47,973,000

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

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

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

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

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

TOTAL RESERVES

479,573,000

387,870,000

443,334,000

436,554,000

420,324,000

MINORITY INTEREST

55,666,000

52,525,000

51,172,000

52,350,000

53,790,000

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

965,851,000

871,007,000

894,506,000

888,904,000

874,114,000

Long term loans

161,854,000

129,964,000

158,648,000

-

205,954,000

Lease obligations

12,461,000

21,821,000

32,784,000

640,000

-

Deferred taxation

8,987,000

32,935,000

19,309,000

14,493,000

10,128,000

Retirement benefits provision

-

-

-

104,884,000

123,632,000

Others

200,636,000

192,370,000

116,870,000

10,606,000

-

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

383,938,000

377,090,000

327,611,000

130,623,000

339,714,000

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

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

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

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

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

1,349,789,000

1,248,097,000

1,222,117,000

1,019,527,000

1,213,828,000

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

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

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

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

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

 

 

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

EMERY OLEOCHEMICALS (M) SDN. BHD.

 

TYPES OF FUNDS

Cash

275,552,000

313,525,000

155,564,000

142,478,000

198,204,000

Net Liquid Funds

179,064,000

198,064,000

31,110,000

92,693,000

194,999,000

Net Liquid Assets

(167,081,000)

(19,361,000)

(120,452,000)

(180,454,000)

144,772,000

Net Current Assets/(Liabilities)

308,845,000

375,340,000

390,289,000

321,565,000

558,374,000

Net Tangible Assets

1,297,484,000

1,231,412,000

1,199,426,000

995,670,000

1,194,236,000

Net Monetary Assets

(551,019,000)

(396,451,000)

(448,063,000)

(311,077,000)

(194,942,000)

BALANCE SHEET ITEMS

Total Borrowings

712,991,000

626,451,000

629,950,000

474,509,000

369,152,000

Total Liabilities

1,311,547,000

1,143,358,000

1,115,225,000

933,780,000

825,585,000

Total Assets

2,277,398,000

2,014,365,000

2,009,731,000

1,822,684,000

1,699,699,000

Net Assets

1,349,789,000

1,248,097,000

1,222,117,000

1,019,527,000

1,213,828,000

Net Assets Backing

965,851,000

871,007,000

894,506,000

888,904,000

874,114,000

Shareholders' Funds

965,851,000

871,007,000

894,506,000

888,904,000

874,114,000

Total Share Capital

430,612,000

430,612,000

400,000,000

400,000,000

400,000,000

Total Reserves

479,573,000

387,870,000

443,334,000

436,554,000

420,324,000

LIQUIDITY (Times)

Cash Ratio

0.30

0.41

0.20

0.18

0.41

Liquid Ratio

0.82

0.97

0.85

0.78

1.30

Current Ratio

1.33

1.49

1.50

1.40

2.15

WORKING CAPITAL CONTROL (Days)

Stock Ratio

61

45

52

59

57

Debtors Ratio

46

45

46

52

55

Creditors Ratio

40

23

27

32

35

SOLVENCY RATIOS (Times)

Gearing Ratio

0.74

0.72

0.70

0.53

0.42

Liabilities Ratio

1.36

1.31

1.25

1.05

0.94

Times Interest Earned Ratio

(0.46)

2.89

1.90

6.10

(0.77)

Assets Backing Ratio

3.01

2.86

3.00

2.49

2.99

PERFORMANCE RATIO (%)

Operating Profit Margin

(1.44)

1.62

0.65

2.48

(1.33)

Net Profit Margin

0.78

1.15

0.18

1.52

(1.47)

Return On Net Assets

(0.95)

6.38

4.09

9.05

(1.25)

Return On Capital Employed

(0.87)

5.95

3.79

8.36

(1.18)

Return On Shareholders' Funds/Equity

2.29

4.26

0.71

5.32

(4.44)

Dividend Pay Out Ratio (Times)

0.00

0.00

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.61.65

UK Pound

1

Rs.96.54

Euro

1

Rs.76.69                     

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

SMN

 

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.