MIRA INFORM REPORT

 

 

Report Date :

09.09.2014              

 

IDENTIFICATION DETAILS

 

Name :

CHANG SHENG HAU SDN. BHD.

 

 

Registered Office :

68-3A, Jalan Pasar, 41400 Klang, Selangor

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2012

 

 

Date of Incorporation :

02.12.1995

 

 

Com. Reg. No.:

369240-K

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Trading of Food Products and Grocery Products

 

 

No. of Employees :

10

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

Status :

Moderate

Payment Behaviour :

Slow but correct

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 01, 2014

 

Country Name

Previous Rating

(31.03.2014)

Current Rating

(01.06.2014)

Malaysia

A2

A2

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low Risk

 

A2

Moderate Low Risk

 

B1

Moderate Risk

 

B2

Moderate High Risk

 

C1

High Risk

 

C2

Very High Risk

 

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.

:

369240-K

COMPANY NAME

:

CHANG SHENG HAU SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

02/12/1995

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

68-3A, JALAN PASAR, 41400 KLANG, SELANGOR, MALAYSIA.

BUSINESS ADDRESS

:

LOT PT 101844, JALAN SERULING 59, TAMAN KLANG JAYA,, 41200 KLANG, SELANGOR, MALAYSIA.

TEL.NO.

:

03-33243757/33421757

FAX.NO.

:

03-33249757

EMAIL

:

CSHSB2007@GMAIL.COM

CONTACT PERSON

:

KHOR LEAN HANG ( MANAGING DIRECTOR )

 

 

 

INDUSTRY CODE

:

46329

PRINCIPAL ACTIVITY

:

TRADING OF FOOD PRODUCTS AND GROCERY 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 1,200,000.00 DIVIDED INTO
ORDINARY SHARES 1,200,000 CASH OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 30,235,899 [2012]

NET WORTH

:

MYR 1,446,989 [2012]

 

 

 

STAFF STRENGTH

:

10 [2014]

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

AVERAGE

MANAGEMENT CAPABILITY

:

AVERAGE

 

 

 

COMMERCIAL RISK

:

HIGH

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

SATISFACTORY

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 

 

HISTORY / BACKGROUND

 

The Subject is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the Subject must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the Subject is capable of owning assets, entering into contracts, sue or be sued by other companies. The liabilities of the shareholders are to the extent of the equity they have taken up and the creditors cannot claim on shareholders' personal assets even if the Subject is insolvent. The Subject is governed by the Companies Act, 1965 and the company must file its annual returns, together with its financial statements with the Registrar of Companies.

The Subject is principally engaged in the (as a / as an) trading of food products and grocery 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 1,200,000.00

13/06/2003

MYR 1,000,000.00

MYR 1,000,000.00

08/09/1997

MYR 500,000.00

MYR 500,000.00

23/05/1996

MYR 500,000.00

MYR 300,000.00

 

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


Name

Address

IC/PP/Loc No

Shareholding

(%)

MR. KHOR LEAN HANG +

LOT 40, JALAN BANTING, PANDAMARAN, 42000 KAPAR, SELANGOR, MALAYSIA.

530925-08-6757 8043846

1,024,999.00

85.42

MS. OOI SAW LIAN +

1, LENGKONGAN GAMBUS 4, TAMAN DESAWAN, 41200 KLANG, SELANGOR, MALAYSIA.

550830-07-5148 4851202

175,001.00

14.58

 

 

 

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

------

 

 

 

1,200,000.00

100.00

 

 

 

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

=====

 

+ Also Director

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MS. OOI SAW LIAN

Address

:

1, LENGKONGAN GAMBUS 4, TAMAN DESAWAN, 41200 KLANG, SELANGOR, MALAYSIA.

IC / PP No

:

4851202

New IC No

:

550830-07-5148

Date of Birth

:

30/08/1955

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

02/12/1995

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MR. KHOR LEAN HANG

Address

:

LOT 40, JALAN BANTING, PANDAMARAN, 42000 KAPAR, SELANGOR, MALAYSIA.

IC / PP No

:

8043846

New IC No

:

530925-08-6757

Date of Birth

:

25/09/1953

 

 

 

Nationality

:

MALAYSIAN CHINESE

Date of Appointment

:

02/12/1995



MANAGEMENT

 

 

 

1)

Name of Subject

:

KHOR LEAN HANG

 

Position

:

MANAGING DIRECTOR

 

 

 

 

 

2)

Name of Subject

:

KHOR CHEAH SENG

 

Position

:

SAFETY MANAGER

 

 

 

AUDITOR

 

Auditor

:

SHAISTRI & CO

Auditor' Address

:

306A, BATU 2 1/2, JALAN KAPAR, 41400 KLANG, SELANGOR, MALAYSIA.

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. LIM AH HUAT

 

IC / PP No

:

7083258

 

New IC No

:

630627-10-7239

 

Address

:

3, JALAN MUDA 70, TAMAN MERU SELATAN, 41050 KLANG, SELANGOR, 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

12/04/2002

FACILITY AGREEMENT

MALAYAN BANKING BERHAD

MYR 2,800,000.00

Unsatisfied

2

05/06/2003

FACILITY AGREEMENT

MALAYAN BANKING BERHAD

MYR 2,200,000.00

Unsatisfied

3

22/02/2005

FACILITY AGREEMENT

MALAYAN BANKING BERHAD

MYR 3,700,000.00

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

 

Import Countries

:

INDIA,CHINA


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

Percentage

:

100%

Domestic Markets

:

MALAYSIA

Overseas

:

NO

 

 

 

 

 

 

 

 

 

Credit Term

:

AS AGREED

 

 

 

 

 

 

Payment Mode

:

CHEQUES
CASH

Type of Customer

:

RETAIL

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Goods Traded

:

GROCERY PRODUCTS, SPICES AND SEASONINGS

 

 

 

Ownership of premises

:

LEASED/RENTED

 

Total Number of Employees:

 

YEAR

2014

2013

2012

2011

2010

 

 

 

 

 

GROUP

N/A

N/A

N/A

N/A

N/A

 

 

 

 

COMPANY

10

10

10

10

10

 

 

 

 

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) trading of food products and grocery products.

The Subject offers a wide range of sundry goods includes onion, dries chillies, garlics, beans and others.

Besides that the Subject also provides products based on the customers' requirements.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-33243757/33421757

Match

:

N/A

 

 

 

Address Provided by Client

:

LOT 2719, JALAN SERULING 59, TAMANG KLANG JAYA 41200 KLANG SLANGOR MALAYSIA

Current Address

:

LOT PT 101844, JALAN SERULING 59, TAMAN KLANG JAYA,, 41200 KLANG, SELANGOR, MALAYSIA.

Match

:

NO

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


On 5th September 2014, we contacted one of the staff from the Subject's and he provided some information on the Subject.

The address provided belongs to the Subject's also.


FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2008 - 2012

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2008 - 2012

]

 

Return on Shareholder Funds

:

Unfavourable

[

1.56%

]

 

Return on Net Assets

:

Unfavourable

[

9.25%

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.The Subject's profit fell sharply because of the high operating costs incurred. The unfavourable return on shareholders' funds could indicate that the Subject was inefficient in utilising its assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Favourable

[

4 Days

]

 

Debtor Ratio

:

Favourable

[

14 Days

]

 

Creditors Ratio

:

Favourable

[

40 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

:

Unfavourable

[

0.36 Times

]

 

Current Ratio

:

Unfavourable

[

0.43 Times

]

 

 

 

 

 

 

 

 

A low liquid ratio means that the Subject may be facing working capital deficiency. If the Subject cannot obtain additional financing or injection of fresh capital, it may face difficulties in meeting its short term obligations.

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Unfavourable

[

1.39 Times

]

 

Gearing Ratio

:

Favourable

[

0.35 Times

]

 

 

 

 

 

 

 

 

The Subject's interest cover was low. If its profits fall or when interest rate rises, it  may not be able to meet all its interest payment. 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 recorded lower profits as its turnover showed a erratic trend. The Subject's management was unable to control its costs efficiently as its profit showed a downward trend. Due to its weak liquidity position, the Subject will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the Subject. If there is a fall in the Subject's profit or any increase in interest rate, the Subject may not be able to generate sufficient cash-flow to service its interest. 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 : POOR

 

 

 

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

 

 

 

 

 

# Based On Manufacturing Production Index
(Source : Department of Statistics / Economic Report / Bank Negara Report)



INDUSTRY ANALYSIS

 

MSIC CODE

46329 : Wholesale of other foodstuffs

 

 

INDUSTRY :

TRADING

 

 

 

According to the Retail Group Malaysia (RGM), the wholesale and retail trade sector forecast to grow to 6% in year 2013. During the first quarter of year 2013, RGM is estimating the retail industry to grow 6.9%. Many retailers have been enjoying better sales since the government handed out cash from mid-January of 2013 under the second round of Bantuan Rakyat 1Malaysia to more than 12 million Malaysians. Bookstores and related retail stores have also started enjoying rising sales since the RM250 1Malaysia Book Voucher was distributed to 1.3 million private and public university students. Besides, since early February 2013, handphone traders and retailers selling smartphone accessories have started to benefit from the RM200 rebate on smartphones for 1.5 million young adults aged between 21 and 30 years with a monthly income of not more than RM3,000.

 

The wholesale and retail trade sector grew 6.1% in the first half of the year 2012 driven by strong domestic consumption and the increasing number of large format stores operating in Malaysia, including 180 foreign hypermarkets, superstores and departmental stores as at end of August 2012. In addition, other indicators such as imports of consumption goods were higher by 15.2%.

 

In 2012, the wholesale and retail trade sector growth to 5.5% driven by higher consumption which benefited from Government initiatives under the 2012 Budget such as BR1M, Baucar Buku 1Malaysia (BB1M) and the RM100 assistance for all primary and secondary school students. The performance of the sector will also be supported by ongoing efforts to modernise the retail segment under the ETP. In 2012, 500 retail shops and 50 workshops are targeted to be modernised under the Retail Shop Transformation (TUKAR) and Automotive Workshop Modernisation (ATOM) programmes, respectively. As at end of July 2012, 95 workshops have been modernised, surpassing the yearly target, while 393 retail shops have been modernised.

 

Growth of the sector is anticipated to remain encouraging with ongoing efforts by the Government to increase its contribution to the economy. Major initiatives include increasing the number of large format stores such as hypermarkets, superstores and departmental stores are carried out to boost the economy.

 

Over 60% of Gross Domestic Product (GDP) is contributed by domestic consumption, therefore the wholesale and retail sector plays a crucial role in driving Malaysia's growth over the next decade despite the ongoing global economic slowdown. By 2020, Malaysia's wholesale and retail sector is expected to boost the country's total Gross National Income (GNI) by RM156 billion, creating 454,190 new jobs.

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 

 

Incorporated in 1995, the Subject is a Private Limited company, focusing on trading of food products and grocery products. Having been in the industry for over a decade, the Subject has achieved a certain market share and has built up a satisfactory reputation in the market. It should have received supports from its regular customers. With a weak shareholders' backing, the Subject's capital position is weak. Inadequate capital may be a constraint to the Subject as it limits its ability to expand its business in future. The capital standing of the Subject is fair. With an adequate share capital, the Subject has the potential of expanding its business in future.

Investigation revealed that the Subject concentrates only on the local market. This narrow market segment has placed the Subject at high business risk and limits its business expansion opportunities. Any adverse changes to the local economy might have a negative impact on the Subject's business performance. Being a small company, the Subject's business operation is supported by 10 employees. Overall, we regard that the Subject's management capability is average. This indicates that the Subject has greater potential to improve its business performance and raising income for the Subject.

The Subject's business performance showed a reverse trend as both its turnover and pre-tax profit have decreased compared to the previous year. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. Due to its weak liquidity position, the Subject may face working capital deficiency in meeting its short term financial obligations if no fresh capital are injected into the Subject. 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 1,446,989, the Subject should be able to maintain its business in the near terms.

Without a strong assets backing, the Subject may face difficulties in getting loans for its future expansion and continued growth . 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.

In view of the above, we recommend credit be granted to the Subject with close monitoring.

 





 PROFIT AND LOSS ACCOUNT

 

 

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

CHANG SHENG HAU SDN. BHD.

 

Financial Year End

2012-12-31

2011-12-31

2010-12-31

2009-12-31

2008-12-31

Months

12

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Company

Audited Account

YES

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

YES

Financial Type

FULL

FULL

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

MYR

 

 

 

 

 

 

TURNOVER

30,235,899

41,606,101

39,702,390

24,417,231

26,377,738

Other Income

32,000

104,500

-

-

-

 

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

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

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

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

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

Total Turnover

30,267,899

41,710,601

39,702,390

24,417,231

26,377,738

Costs of Goods Sold

(29,225,096)

(40,578,596)

(38,826,319)

(23,744,592)

-

 

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

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

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

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

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

Gross Profit

1,042,803

1,132,005

876,071

672,639

-

 

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

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

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

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

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

 

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

41,001

61,074

39,650

32,626

(178,316)

 

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

41,001

61,074

39,650

32,626

(178,316)

Taxation

(18,475)

(18,447)

12,352

(28,023)

23,633

 

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

22,526

42,627

52,002

4,603

(154,683)

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

 

As previously reported

224,463

181,836

250,401

642,135

796,818

Prior year adjustment

-

-

(120,567)

(396,337)

-

 

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

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

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

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

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

As restated

224,463

181,836

129,834

245,798

796,818

 

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

246,989

224,463

181,836

250,401

642,135

 

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

246,989

224,463

181,836

250,401

642,135

 

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

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

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

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

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

 

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

 

Bank overdraft

-

53

4,363

969

1,767

Bankers' acceptance

74,753

65,270

-

-

-

Hire purchase

7,327

10,064

8,984

6,824

9,170

Term loan / Borrowing

-

8,515

24,732

40,923

72,820

Others

24,364

19,769

203,222

188,796

285,618

 

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

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

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

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

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

 

106,444

103,671

241,301

237,512

369,375

 

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

CHANG SHENG HAU SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

 

FIXED ASSETS

4,281,384

4,283,061

4,417,883

4,176,515

4,231,590

 

 

 

 

 

 

Deferred assets

46,705

65,180

72,300

52,739

63,187

 

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

46,705

65,180

72,300

52,739

63,187

 

 

 

 

 

 

 

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

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

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

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

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

TOTAL LONG TERM ASSETS

4,328,089

4,348,241

4,490,183

4,229,254

4,294,777

 

 

 

 

 

 

Stocks

296,400

126,000

293,216

431,418

648,300

Trade debtors

1,133,837

1,053,304

1,548,733

2,031,098

2,540,387

Other debtors, deposits & prepayments

81,123

37,600

19,600

140,867

137,867

Amount due from director

381,005

382,183

545,373

579,197

616,704

Cash & bank balances

140,372

57,892

243,756

183,087

122,404

 

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

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

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

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

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

TOTAL CURRENT ASSETS

2,032,737

1,656,979

2,650,678

3,365,667

4,065,662

 

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

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

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

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

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

TOTAL ASSET

6,360,826

6,005,220

7,140,861

7,594,921

8,360,439

 

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

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

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

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

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

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

Trade creditors

3,172,990

3,164,217

901,660

128,589

82,154

Other creditors & accruals

1,228,528

348,896

498,500

209,378

148,452

Hire purchase & lease creditors

76,011

43,422

65,704

41,704

41,704

Bank overdraft

-

-

3,876

-

4,676

Short term borrowings/Term loans

-

-

191,545

178,500

252,289

Bill & acceptances payable

290,000

794,000

3,609,000

4,795,000

5,248,000

Amounts owing to director

-

874

874

1,174

-

Provision for taxation

-

120,362

247,079

388,282

-

 

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

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

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

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

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

TOTAL CURRENT LIABILITIES

4,767,529

4,471,771

5,518,238

5,742,627

5,777,275

 

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

(2,734,792)

(2,814,792)

(2,867,560)

(2,376,960)

(1,711,613)

 

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

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

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

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

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

TOTAL NET ASSETS

1,593,297

1,533,449

1,622,623

1,852,294

2,583,164

 

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

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

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

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

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

 

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

 

Ordinary share capital

1,200,000

1,200,000

1,200,000

1,200,000

1,200,000

 

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

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

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

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

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

TOTAL SHARE CAPITAL

1,200,000

1,200,000

1,200,000

1,200,000

1,200,000

 

 

 

 

 

 

Retained profit/(loss) carried forward

246,989

224,463

181,836

250,401

642,135

 

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

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

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

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

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

TOTAL RESERVES

246,989

224,463

181,836

250,401

642,135

 

 

 

 

 

 

 

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

1,446,989

1,424,463

1,381,836

1,450,401

1,842,135

 

 

 

 

 

 

Long term loans

146,308

108,986

240,787

401,893

741,029

 

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

146,308

108,986

240,787

401,893

741,029

 

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

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

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

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

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

 

1,593,297

1,533,449

1,622,623

1,852,294

2,583,164

 

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

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

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

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

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

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

CHANG SHENG HAU SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

 

Cash

140,372

57,892

243,756

183,087

122,404

Net Liquid Funds

(149,628)

(736,108)

(3,369,120)

(4,611,913)

(5,130,272)

Net Liquid Assets

(3,031,192)

(2,940,792)

(3,160,776)

(2,808,378)

(2,359,913)

Net Current Assets/(Liabilities)

(2,734,792)

(2,814,792)

(2,867,560)

(2,376,960)

(1,711,613)

Net Tangible Assets

1,593,297

1,533,449

1,622,623

1,852,294

2,583,164

Net Monetary Assets

(3,177,500)

(3,049,778)

(3,401,563)

(3,210,271)

(3,100,942)

BALANCE SHEET ITEMS

 

 

 

 

 

Total Borrowings

512,319

946,408

4,110,912

5,417,097

6,287,698

Total Liabilities

4,913,837

4,580,757

5,759,025

6,144,520

6,518,304

Total Assets

6,360,826

6,005,220

7,140,861

7,594,921

8,360,439

Net Assets

1,593,297

1,533,449

1,622,623

1,852,294

2,583,164

Net Assets Backing

1,446,989

1,424,463

1,381,836

1,450,401

1,842,135

Shareholders' Funds

1,446,989

1,424,463

1,381,836

1,450,401

1,842,135

Total Share Capital

1,200,000

1,200,000

1,200,000

1,200,000

1,200,000

Total Reserves

246,989

224,463

181,836

250,401

642,135

LIQUIDITY (Times)

 

 

 

 

 

Cash Ratio

0.03

0.01

0.04

0.03

0.02

Liquid Ratio

0.36

0.34

0.43

0.51

0.59

Current Ratio

0.43

0.37

0.48

0.59

0.70

WORKING CAPITAL CONTROL (Days)

 

 

 

 

 

Stock Ratio

4

1

3

6

9

Debtors Ratio

14

9

14

30

35

Creditors Ratio

40

28

8

2

1

SOLVENCY RATIOS (Times)

 

 

 

 

 

Gearing Ratio

0.35

0.66

2.97

3.73

3.41

Liabilities Ratio

3.40

3.22

4.17

4.24

3.54

Times Interest Earned Ratio

1.39

1.59

1.16

1.14

0.52

Assets Backing Ratio

1.33

1.28

1.35

1.54

2.15

PERFORMANCE RATIO (%)

 

 

 

 

 

Operating Profit Margin

0.14

0.15

0.10

0.13

(0.68)

Net Profit Margin

0.07

0.10

0.13

0.02

(0.59)

Return On Net Assets

9.25

10.74

17.31

14.58

7.40

Return On Capital Employed

8.83

10.45

16.60

14.26

7.27

Return On Shareholders' Funds/Equity

1.56

2.99

3.76

0.32

(8.40)

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.60.26

UK Pound

1

Rs.97.51

Euro

1

Rs.77.94

 

INFORMATION DETAILS

 

Analysis Done by :

DIV

 

 

Report Prepared by :

PDT

 

               

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.