MIRA INFORM REPORT

Report Date :

02.09.2014

IDENTIFICATION DETAILS

Name :	FUDEX RUBBER PRODUCTS (M) SDN. BHD.
Registered Office :	B-01-24, Jalan Bunga Pekan, 1st Floor, 42700 Banting, Selangor,
Country :	Malaysia
Financials (as on) :	31.12.2013
Date of Incorporation :	05.12.1979
Com. Reg. No.:	52885-D
Legal Form :	Private Limited
Line of Business :	Manufacturer of rubber hoses & rubber products
No. of Employees	200 [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	A1	A1

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

Company name and address

REGISTRATION NO.

:

52885-D

COMPANY NAME

:

FUDEX RUBBER PRODUCTS (M) SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

05/12/1979

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

B-01-24, JALAN BUNGA PEKAN, 1ST FLOOR, 42700 BANTING, SELANGOR, MALAYSIA.

BUSINESS ADDRESS

:

JA 9158, JASIN INDUSTRIAL PARK, 77200 BEMBAN, MELAKA, MALAYSIA.

TEL.NO.

:

06-5292229

FAX.NO.

:

06-5292323

WEB SITE

:

WWW.FUDEX.COM.MY

CONTACT PERSON

:

RONNIE LOW ( EXECUTIVE DIRECTOR )

INDUSTRY CODE

:

221

PRINCIPAL ACTIVITY

:

MANUFACTURER OF RUBBER HOSES & RUBBER PRODUCTS

AUTHORISED CAPITAL

:

MYR 5,000,000.00 DIVIDED INTO
ORDINARY SHARE 5,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 2,250,000.00 DIVIDED INTO
ORDINARY SHARES 2,250,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 25,478,890 [2013]

NET WORTH

:

MYR 12,449,439 [2013]

STAFF STRENGTH

:

200 [2014]

BANKER (S)

:

BANK PEMBANGUNAN MALAYSIA BHD CIMB BANK BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STRONG

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) manufacturer of rubber hoses & rubber products.

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

Share Capital History

Date	Authorised Shared Capital	Issue & Paid Up Capital
15/02/2013	MYR 5,000,000.00	MYR 2,250,000.00
04/08/2005	MYR 5,000,000.00	MYR 1,050,000.00
22/12/1988	MYR 1,000,000.00	MYR 1,000,000.00
30/01/1988	MYR 1,000,000.00	MYR 750,000.00

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

Name	Address	IC/PP/Loc No	Shareholding	(%)
SRI KHL CORPORATION SDN. BHD.	NO. 27-A, JALAN JUGRA, 42700 BANTING, SELANGOR, MALAYSIA.	567778T	696,428.00	30.95
CANDAG (M) SDN. BHD.	NO. 9, JALAN BERINGIN 4, KAWASAN 2, 42700 BANTING, SELANGOR, MALAYSIA.	389942K	675,000.00	30.00
MS. TAN GIOK ENG	7880-C, JALAN DATUK PALEMBANG, BUKIT BARU, 75150 MELAKA, MELAKA, MALAYSIA.	390719-04-5020 3049091	235,714.00	10.48
MR. LOW YUET SEONG +	NO 1A, JALAN MP 15, MELAKA PERDANA RESORT HOMES, BUKIT JALIL, 75450 AIR KEROH, MELAKA, MALAYSIA.	601125-10-6065 6107059	214,286.00	9.52
MR. TEE KOK THONG +	NO 9, JALAN BERINGIN 4, KAWASAN 2, 42700 BANTING, SELANGOR, MALAYSIA.	650325-10-5287 A0023598	214,286.00	9.52
MR. KHOR LIN HENG +	70, LINTANG BUKIT KECIL 2, TAMAN SRI NIBONG, 11900 BAYAN LEPAS, PULAU PINANG, MALAYSIA.	570219-02-5881 5155076	107,143.00	4.76
MR. KHOR LEIN HOO	LOT C10-1-08, GHOODYEAR COURT 3, SUBANG PERDANA, OFF JLN KEWAJIPAN, 47601 SUBANG JAYA, SELANGOR, MALAYSIA.	600321-02-5401 5945367	107,143.00	4.76
			---------------	------
			2,250,000.00	100.00
			============	=====

+ Also Director

DIRECTORS

DIRECTOR 1

Name Of Subject	:	MR. ANG KIM HONG
Address	:	72, JALAN MORIB, 42700 BANTING, SELANGOR, MALAYSIA.
IC / PP No	:	5886334
New IC No	:	600327-10-5461
Date of Birth	:	27/03/1960
Nationality	:	MALAYSIAN CHINESE
Date of Appointment	:	17/11/2003

DIRECTOR 2

Name Of Subject	:	MR. TEE KOK LIN
Address	:	9,JALAN BERINGIN 4, KAWASAN 2, 42700 BANTING, SELANGOR, MALAYSIA.
IC / PP No	:	5368002
New IC No	:	580328-10-5089
Date of Birth	:	28/03/1958
Nationality	:	MALAYSIAN
Date of Appointment	:	17/11/2003

DIRECTOR 3

Name Of Subject	:	MR. CHONG YOON LEE
Address	:	72, JALAN MORIB, 42700 BANTING, SELANGOR, MALAYSIA.
IC / PP No	:	5321419
New IC No	:	580223-10-5461
Date of Birth	:	23/02/1958
Nationality	:	MALAYSIAN
Date of Appointment	:	17/11/2003

DIRECTOR 4

Name Of Subject	:	MR. KHOR LIN HENG
Address	:	70, LINTANG BUKIT KECIL 2, TAMAN SRI NIBONG, 11900 BAYAN LEPAS, PULAU PINANG, MALAYSIA.
IC / PP No	:	5155076
New IC No	:	570219-02-5881
Date of Birth	:	19/02/1957
Nationality	:	MALAYSIAN
Date of Appointment	:	04/08/2005

DIRECTOR 5

Name Of Subject	:	MR. LOW YUET SEONG
Address	:	NO 1A, JALAN MP 15, MELAKA PERDANA RESORT HOMES, BUKIT JALIL, 75450 AIR KEROH, MELAKA, MALAYSIA.
IC / PP No	:	6107059
New IC No	:	601125-10-6065
Date of Birth	:	25/11/1960
Nationality	:	MALAYSIAN
Date of Appointment	:	17/11/2003

DIRECTOR 6

Name Of Subject	:	MR. TEE KOK THONG
Address	:	NO 9, JALAN BERINGIN 4, KAWASAN 2, 42700 BANTING, SELANGOR, MALAYSIA.
IC / PP No	:	A0023598
New IC No	:	650325-10-5287
Date of Birth	:	25/03/1965
Nationality	:	MALAYSIAN
Date of Appointment	:	17/11/2003

MANAGEMENT

1)	Name of Subject	:	RONNIE LOW
	Position	:	EXECUTIVE DIRECTOR

AUDITOR

Auditor	:	PRICEWATERHOUSECOOPERS
Auditor' Address	:	LEVEL 15, 1 SENTRAL, JALAN TRAVERS,K.L. CENTRAL, P.O.BOX 10192, 50706 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

COMPANY SECRETARIES

1)	Company Secretary	:	MR. KOK YOON HEE
	IC / PP No	:	4772439
	New IC No	:	550325-10-5561
	Address	:	2 JALAN CEMPAKA PUTIH 9, TAMAN CEMPAKA, 42700 BANTING, SELANGOR, MALAYSIA.

BANKING

Banking relations are maintained principally with :

1)

Name

:

BANK PEMBANGUNAN MALAYSIA BHD

2)

Name

:

CIMB BANK BHD

ENCUMBRANCE (S)

Charge No	Creation Date	Charge Description	Chargee Name	Total Charge	Status
1	25/05/1982	N/A	PERWIRA HABIB BANK MALAYSIA BHD	MYR 1,600,000.00	Satisfied
2	11/10/1983	N/A	PERWIRA HABIB BANK MALAYSIA BHD	MYR 200,000.00	Satisfied
3	16/07/1986	N/A	PERWIRA HABIB BANK MALAYSIA BHD	MYR 1,800,000.00	Satisfied
4	20/01/1988	N/A	PERWIRA HABIB BANK MALAYSIA BERHAD	MYR 1,800,000.00	Satisfied
5	09/03/1989	N/A	PERWIRA HABIB BANK MALAYSIA BHD	MYR 350,000.00	Satisfied
6	09/03/1989	N/A	PERWIRA HABIB BANK MALAYSIA BHD	MYR 350,000.00	Satisfied
7	27/07/1993	N/A	BANK OF COMMERCE M BERHAD	MYR 2,300,000.00	Satisfied
8	05/03/1997	DEBENTURE & CHARGE	BANK PEMBANGUNAN MALAYSIA BERHAD	MYR 3,700,000.00	Satisfied
9	31/07/2000	2ND CHARGE	BANK PEMBANGUNAN DAN INFRASTRUKTUR MALAYSIA BERHAD	MYR 3,000,000.00	Satisfied
10	07/03/2001	DEBENTURE	BUMIPUTRA-COMMERCE BANK BHD	MYR 1,950,000.00	Unsatisfied
11	07/03/2001	1ST PARTY 3RD LEGAL CHARGE	BUMIPUTRA-COMMERCE BANK BHD	MYR 1,950,000.00	Unsatisfied
12	19/06/2003	GENERAL FACILITY AGREEMENT AND DEBENTURE	BUMIPUTRA-COMMERCE BANK BHD	MYR 500,000.00	Unsatisfied
13	27/12/2004	LAND CHARGE AND DEBENTURE	BUMIPUTRA-COMMERCE BANK BHD	MYR 2,300,000.00	Unsatisfied
14	07/06/2007	5TH DEBENTURE AND 1ST PARTY LAND CHARGE	CIMB BANK BERHAD	MYR 2,400,000.00	Unsatisfied
15	31/10/2012	DEBENTURE AND FACILITIES AGREEMENT	CIMB BANK BERHAD	-	Unsatisfied
16	06/11/2012	FACILITY AGREEMENT AND MEMORANDUM OF CHARGE	CIMB BANK BERHAD	-	Unsatisfied

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

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 MIDDLE EAST AUSTRALIA UNITED STATES ASIA
Credit Term	:	AS AGREED
Payment Mode	:	TELEGRAPHIC TRANSFER (TT) CHEQUES

OPERATIONS

Products manufactured

:

FUEL/HEATER/RADIATOR RUBBER HOSES, RUBBER MOULDED PARTS

Product Brand Name

:

FUDEX

Award

:

1 ) ISO/ TS 16949 : 2002 Year :2006
2 ) MS ISO 9000 : 2000 Year :2004

Competitor(s)

:

TECHNOMEIJI RUBBER SDN BHD

Member(s) / Affiliate(s)

:

FEDERATION OF MALAYSIAN MANUFACTURERS (FMM)

SMI ASSOCIATION OF MALAYSIA

MALAYSIA EXTERNAL TRADE DEVELOPMENT CORPORATION (MATRADE)

SMALL & MEDIUM ENTERPRISE

Ownership of premises

:

OWNED

Total Number of Employees:
YEAR	2014	2012	2011	2010
GROUP	N/A	N/A	N/A	N/A
COMPANY	200	190	209	204

Branch

:

NO

Other Information:

The Subject is principally engaged in the (as a / as an) manufacturer of rubber hoses & rubber products.

Fudex is a well diversified radiator and fuel hose manufacturer.

The Subject also involved in profile extrusion and moulding products mainly for automotive industry but is increasingly diversifying into other industries as well.

The Subject is the leading supplier of coolant hoses for Malaysia’s first and second national cars PROTON and PERODUA.

Fudex continuously undertakes investing and intensive research in innovative technology for industry advancement.

Its rubber products are always subjected to ongoing development and research conducted in collaboration with the Malaysian Rubber Board to evolve rubber-based products of the highest standards.

CURRENT INVESTIGATION

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client	:	065292229
Current Telephone Number	:	06-5292229
Match	:	YES
Address Provided by Client	:	JA 9158, JASIN INDUSTRIAL PARK,77200,BEMBAN,MELAKA.
Current Address	:	JA 9158, JASIN INDUSTRIAL PARK, 77200 BEMBAN, MELAKA, MALAYSIA.
Match	:	YES
Latest Financial Accounts	:	YES

Other Investigations

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

FINANCIAL ANALYSIS

Profitability
Turnover	:	Increased	[	2009 - 2013	]
Profit/(Loss) Before Tax	:	Increased	[	2009 - 2013	]
Return on Shareholder Funds	:	Unfavourable	[	8.55%	]
Return on Net Assets	:	Acceptable	[	10.81%	]
The Subject's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The higher profit could be attributed to the increase in turnover. The unfavourable return on shareholders' funds could indicate that the Subject was inefficient in utilising its assets to generate returns.
Liquidity
Current Ratio	:	Favourable	[	2.09 Times	]
The Subject was in good liquidity position with its current  liabilities  well covered by its current assets. With its net current assets, the Subject should be able to repay its short term obligations.
Solvency
Liability Ratio	:	Favourable	[	0.40 Times	]
A low liabilities ratio has minimised the Subject's financial risk.
Overall Assessment :
Generally, the Subject's performance has improved with higher turnover and profit. The Subject was in good liquidity position with its total current liabilities well covered by its total current assets. With its current net assets, the Subject should be able to repay its short term obligations. The Subject has a low liabilities ratio. It's liabilities were low and was not vulnerable to the financial risk.
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	28,876
Individual Bankruptcy ( No.)	16,228	18,119	19,167	19,575	21,984
Individual Bankruptcy ( % )	16.7	11.7	5.8	2.1	12.3

INDUSTRIES ( % of Growth ):	2009	2010	2011	2012*	2013**
Agriculture	0.1	2.4	5.8	1.3	2.1
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	(6.5)	(0.3)	(5.4)	1.0	0.7
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 #	(9.0)	11.9	4.7	4.8	3.5
Exported-oriented Industries	(19.0)	12.1	2.8	4.1	-
Electrical & Electronics	(30.3)	28.4	(4.0)	12.7	18.6
Rubber Products	(10.1)	25.3	20.7	3.0	8.2
Wood Products	(24.1)	20.1	(5.1)	8.7	(3.1)
Textiles & Apparel	(19.5)	(0.4)	13.2	(7.1)	(2.6)
Domestic-oriented Industries	(9.8)	16.3	6.5	8.6	-
Food, Beverages & Tobacco	0.2	3.0	4.8	2.7	3.6
Chemical & Chemical Products	(7.7)	16.2	10.0	10.8	(0.7)
Plastic Products	(9.1)	2.4	3.8	-	-
Iron & Steel	(32.7)	29.3	2.2	(6.6)	3.4
Fabricated Metal Products	(2.5)	14.9	21.8	13.8	12.2
Non-metallic Mineral	(15.5)	20.2	12.1	2.9	(0.4)
Transport Equipment	(13.5)	36.5	12.0	3.4	13.8
Paper & Paper Products	(5.0)	18.7	9.5	3.1	2.3
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	6.2	11.4	4.7	18.6	10.9
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	2.9	7.4	7.1	6.4	5.9
Electric, Gas & Water	1.4	7.8	3.5	4.4	4.2
Transport, Storage & Communication	1.6	7.7	6.5	7.1	7.3
Wholesale, Retail, Hotel & Restaurant	2.8	4.7	5.2	4.7	5.9
Finance, Insurance & Real Estate	3.8	6.1	6.9	9.7	3.7
Government Services	3.4	5.9	12.4	9.4	8.3
Other Services	3.8	4.4	5.1	3.9	5.1
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

INDUSTRY ANALYSIS

MSIC CODE
221 : Manufacture of rubber 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 1979, the Subject is a Private Limited company, focusing on manufacturer of rubber hoses & rubber products. 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. Having strong support from its shareholder has enabled the Subject to remain competitive despite the challenging business environment. The capital standing of the Subject is fair. With an adequate share capital, the Subject has the potential of expanding its business in future.

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 200 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.

We noted that both the turnover and profits have increased compared to the previous year. The higher profit could be due to increase in turnover and better control over its operating costs. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. The Subject is in good liquidity position with its current liabilities well covered by it current assets. Hence, it has sufficient working capital to meet its short term financial obligations. A low liabilities ratio has minimised the Subject's financial risk. Given a positive net worth standing at MYR 12,449,439, 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.

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 promptly.

PROFIT AND LOSS ACCOUNT

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

FUDEX RUBBER PRODUCTS (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	Company	Company	Company	Company	Company
Audited Account	YES	YES	YES	YES	YES
Unqualified Auditor's Report (Clean Opinion)	YES	YES	YES	YES	YES
Financial Type	SUMMARY	FULL	FULL	FULL	SUMMARY
Currency	MYR	MYR	MYR	MYR	MYR
TURNOVER	25,478,890	22,347,271	18,979,210	17,481,444	14,254,089
	----------------	----------------	----------------	----------------	----------------
Total Turnover	25,478,890	22,347,271	18,979,210	17,481,444	14,254,089
Costs of Goods Sold	-	(19,100,829)	(15,676,229)	(14,697,434)	-
	----------------	----------------	----------------	----------------	----------------
Gross Profit	-	3,246,442	3,302,981	2,784,010	-
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) FROM OPERATIONS	1,449,264	818,683	891,635	480,417	416,570
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE TAXATION	1,449,264	818,683	891,635	480,417	416,570
Taxation	(384,233)	(135,786)	(96,804)	27,000	(108,000)
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) AFTER TAXATION	1,065,031	682,897	794,831	507,417	308,570
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported	9,336,908	8,755,261	8,365,430	7,858,013	7,549,443
	----------------	----------------	----------------	----------------	----------------
As restated	9,336,908	8,755,261	8,365,430	7,858,013	7,549,443
	----------------	----------------	----------------	----------------	----------------
PROFIT AVAILABLE FOR APPROPRIATIONS	10,401,939	9,438,158	9,160,261	8,365,430	7,858,013
DIVIDENDS - Ordinary (paid & proposed)	(202,500)	(101,250)	(405,000)	-	-
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD	10,199,439	9,336,908	8,755,261	8,365,430	7,858,013
	=============	=============	=============	=============	=============
INTEREST EXPENSE (as per notes to P&L)
Bank overdraft	-	8,740	2,368	2,826	-
Bankers' acceptance	-	47,186	23,541	21,295	-
Hire purchase	-	2,728	2,998	5,059	-
Letter of credit	-	2,286	7,627	230	-
Revolving loans	-	26,770	26,653	20,952	-
Term loan / Borrowing	-	35,971	73,717	106,468	-
	----------------	----------------	----------------	----------------	----------------
	-	123,681	136,904	156,830	-
	=============	=============	=============	=============

BALANCE SHEET

FUDEX RUBBER PRODUCTS (M) SDN. BHD.

ASSETS EMPLOYED:
FIXED ASSETS	8,996,065	8,525,325	8,669,306	8,249,897	8,626,339
Associated companies	-	72,913	-	-	-
Investments	-	15,000	15,000	15,000	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS	87,913	87,913	15,000	15,000	15,000
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM ASSETS	9,083,978	8,613,238	8,684,306	8,264,897	8,641,339
Stocks	-	3,719,050	3,764,372	2,804,349	-
Trade debtors	-	4,309,470	3,939,030	4,716,014	-
Other debtors, deposits & prepayments	-	211,164	236,505	148,523	-
Amount due from associated companies	-	215,540	-	-	-
Cash & bank balances	-	1,054,550	2,660	134,427	-
Others	-	-	-	79,750	-
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT ASSETS	8,283,705	9,509,774	7,942,567	7,883,063	7,337,036
	----------------	----------------	----------------	----------------	----------------
TOTAL ASSET	17,367,683	18,123,012	16,626,873	16,147,960	15,978,375
	=============	=============	=============	=============	=============
CURRENT LIABILITIES
Trade creditors	-	2,796,391	2,434,894	2,096,366	-
Other creditors & accruals	-	388,832	356,046	401,013	-
Hire purchase & lease creditors	-	16,004	16,004	18,024	-
Bank overdraft	-	-	366,749	-	-
Short term borrowings/Term loans	-	400,254	411,313	573,222	-
Other borrowings	-	500,000	509,644	500,000	-
Bill & acceptances payable	-	1,200,000	604,000	604,000	-
Provision for taxation	-	91,123	13,668	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	3,965,901	5,392,604	4,712,318	4,192,625	4,080,227
	----------------	----------------	----------------	----------------	----------------
NET CURRENT ASSETS/(LIABILITIES)	4,317,804	4,117,170	3,230,249	3,690,438	3,256,809
	----------------	----------------	----------------	----------------	----------------
TOTAL NET ASSETS	13,401,782	12,730,408	11,914,555	11,955,335	11,898,148
	=============	=============	=============	=============	=============
SHARE CAPITAL
Ordinary share capital	2,250,000	2,250,000	2,250,000	2,250,000	2,250,000
	----------------	----------------	----------------	----------------	----------------
TOTAL SHARE CAPITAL	2,250,000	2,250,000	2,250,000	2,250,000	2,250,000
Retained profit/(loss) carried forward	10,199,439	9,336,908	8,755,261	8,365,430	7,858,013
	----------------	----------------	----------------	----------------	----------------
TOTAL RESERVES	10,199,439	9,336,908	8,755,261	8,365,430	7,858,013
	----------------	----------------	----------------	----------------	----------------
SHAREHOLDERS' FUNDS/EQUITY	12,449,439	11,586,908	11,005,261	10,615,430	10,108,013
Long term loans	-	575,181	275,951	685,578	-
Hire purchase creditors	-	21,319	37,343	53,327	-
Deferred taxation	-	547,000	596,000	601,000	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	952,343	1,143,500	909,294	1,339,905	1,790,135
	----------------	----------------	----------------	----------------	----------------
	13,401,782	12,730,408	11,914,555	11,955,335	11,898,148
	=============	=============	=============	=============	=============

FINANCIAL RATIO

FUDEX RUBBER PRODUCTS (M) SDN. BHD.

TYPES OF FUNDS
Cash	-	1,054,550	2,660	134,427	-
Net Liquid Funds	-	(145,450)	(968,089)	(469,573)	-
Net Liquid Assets	4,317,804	398,120	(534,123)	886,089	3,256,809
Net Current Assets/(Liabilities)	4,317,804	4,117,170	3,230,249	3,690,438	3,256,809
Net Tangible Assets	13,401,782	12,730,408	11,914,555	11,955,335	11,898,148
Net Monetary Assets	3,365,461	(745,380)	(1,443,417)	(453,816)	1,466,674
BALANCE SHEET ITEMS
Total Borrowings	-	2,739,528	2,247,657	2,455,103	-
Total Liabilities	4,918,244	6,536,104	5,621,612	5,532,530	5,870,362
Total Assets	17,367,683	18,123,012	16,626,873	16,147,960	15,978,375
Net Assets	13,401,782	12,730,408	11,914,555	11,955,335	11,898,148
Net Assets Backing	12,449,439	11,586,908	11,005,261	10,615,430	10,108,013
Shareholders' Funds	12,449,439	11,586,908	11,005,261	10,615,430	10,108,013
Total Share Capital	2,250,000	2,250,000	2,250,000	2,250,000	2,250,000
Total Reserves	10,199,439	9,336,908	8,755,261	8,365,430	7,858,013
LIQUIDITY (Times)
Cash Ratio	-	0.20	0.00	0.03	-
Liquid Ratio	-	1.07	0.89	1.21	-
Current Ratio	2.09	1.76	1.69	1.88	1.80
WORKING CAPITAL CONTROL (Days)
Stock Ratio	-	61	72	59	-
Debtors Ratio	-	70	76	98	-
Creditors Ratio	-	53	57	52	-
SOLVENCY RATIOS (Times)
Gearing Ratio	-	0.24	0.20	0.23	-
Liabilities Ratio	0.40	0.56	0.51	0.52	0.58
Times Interest Earned Ratio	-	7.62	7.51	4.06	-
Assets Backing Ratio	5.96	5.66	5.30	5.31	5.29
PERFORMANCE RATIO (%)
Operating Profit Margin	5.69	3.66	4.70	2.75	2.92
Net Profit Margin	4.18	3.06	4.19	2.90	2.16
Return On Net Assets	10.81	7.40	8.63	5.33	3.50
Return On Capital Employed	10.81	7.38	8.35	5.31	3.50
Return On Shareholders' Funds/Equity	8.55	5.89	7.22	4.78	3.05
Dividend Pay Out Ratio (Times)	0.19	0.15	0.51	0.00	-
NOTES TO ACCOUNTS
Contingent Liabilities	-	0	0	0

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.60.47
UK Pound	1	Rs.100.42
Euro	1	Rs.79.39

INFORMATION DETAILS

Analysis Done by :	KAR
Report Prepared by :	NIS

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

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