MIRA INFORM REPORT

Report No. :	352246
Report Date :	03.12.2015

IDENTIFICATION DETAILS

Name :	EB PACKAGING SDN. BHD.
Registered Office :	26-30, Jalan Sri Sulong 19/A, Taman Perindustrian Sri Sulong, 83020 Batu Pahat, Johor
Country :	Malaysia
Financials (as on) :	31.10.2014
Date of Incorporation :	19.07.1995
Com. Reg. No.:	351886-U
Legal Form :	Private Limited
Line of Business :	Manufacturing of Plastic Packaging Materials, Stretch Film, Pe Foam Sheet, Opp Tapes, Plastic Bags, Air Bubble & Adhesive Tapes.
No. of Employees :	200 [2015]

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 – March 31, 2015

Country Name	Previous Rating (31.12.2014)	Current Rating (31.03.2015)
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. Malaysia is vulnerable to a fall in world commodity prices or a general slowdown in global economic activity.

The NAJIB administration 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. Gross exports of goods and services constitute more than 80% of GDP. The oil and gas sector supplied about 29% of government revenue in 2014. As an oil and gas exporter, Malaysia has previously 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. Falling global oil prices in the second half of 2014 have strained government finances, shrunk Malaysia’s current account surplus and put downward pressure on the ringgit. The government is trying to lessen its dependence on state oil producer Petronas.

Bank Negara Malaysia (the central bank) maintains healthy foreign exchange reserves; a well-developed regulatory regime has limited Malaysia's exposure to riskier financial instruments and the global financial crisis. In order to attract increased investment, NAJIB 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.

Malaysia is a member of the 12-nation Trans-Pacific Partnership free trade agreement negotiations and, with the nine other ASEAN members, will form the ASEAN Economic Community in 2015.

Source : CIA

EXECUTIVE SUMMARY

REGISTRATION NO.

:

351886-U

COMPANY NAME

:

EB PACKAGING SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

19/07/1995

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

26-30, JALAN SRI SULONG 19/A, TAMAN PERINDUSTRIAN SRI SULONG, 83020 BATU PAHAT, JOHOR, MALAYSIA.

BUSINESS ADDRESS

:

26-30, JALAN SRI SULONG 19/A, TAMAN INDUSTRI SRI SULONG, 83020 BATU PAHAT, JOHOR, MALAYSIA.

TEL.NO.

:

07-4101188

FAX.NO.

:

07-4102688

CONTACT PERSON

:

SIOW CHEW KIONG ( MANAGING DIRECTOR )

INDUSTRY CODE

:

22204

PRINCIPAL ACTIVITY

:

MANUFACTURING OF PLASTIC PACKAGING MATERIALS, STRETCH FILM, PE FOAM SHEET, OPP TAPES, PLASTIC BAGS, AIR BUBBLE & ADHESIVE TAPES

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 4,000,000.00 DIVIDED INTO
ORDINARY SHARES 4,000,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 85,725,347 [2014]

NET WORTH

:

MYR 22,026,901 [2014]

STAFF STRENGTH

:

200 [2015]

BANKER (S)

:

ALLIANCE BANK MALAYSIA BHD AMBANK (M) BHD CIMB BANK BHD EON BANK BHD HONG LEONG BANK BHD OCBC BANK (MALAYSIA) BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

FAIR

PAYMENT

:

GOOD

MANAGEMENT CAPABILITY

:

AVERAGE

COMMERCIAL RISK

:

LOW

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) manufacturing of plastic packaging materials, stretch film, pe foam sheet, opp tapes, plastic bags, air bubble & adhesive tapes.

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

The immediate holding company of the Subject is ELITEBASE SDN. BHD., a company incorporated in MALAYSIA.

Share Capital History

Date	Authorised Shared Capital	Issue & Paid Up Capital
30/04/2015	MYR 5,000,000.00	MYR 4,000,000.00
30/11/2006	MYR 5,000,000.00	MYR 3,000,000.00
04/03/2004	MYR 1,000,000.00	MYR 1,000,000.00
24/12/2002	MYR 500,000.00	MYR 500,000.00
11/07/1996	MYR 100,000.00	MYR 100,000.00
25/07/1995	MYR 100,000.00	MYR 2.00

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

Current Shareholder(s) :

Name	Address	IC/PP/Loc No	Shareholding	(%)
ELITEBASE SDN. BHD.	ROOM 2, 15A, JALAN SULAIMAN, FIRST FLOOR, 83000 BATU PAHAT, JOHOR, MALAYSIA.	317751X	4,000,000.00	100.00
			---------------	------
			4,000,000.00	100.00
			============	=====

+ Also Director

DIRECTORS

DIRECTOR 1

Name Of Subject	:	MR. SIOW CHEW KIONG
Address	:	42, JALAN KERANJI, TAMAN KEBUN TEH, 80250 JOHOR BAHRU, JOHOR, MALAYSIA.
Other Address(es)	:	- NO 22 JALAN SRI SULONG 19/A, TAMAN INDUSTRI SRI SULONG, 83020 BATU PAHAT, JOHOR, MALAYSIA.
IC / PP No	:	A0287128
New IC No	:	660320-01-6305
Date of Birth	:	20/03/1966
Nationality	:	MALAYSIAN
Date of Appointment	:	19/07/1995

DIRECTOR 2

Name Of Subject	:	MR. TEO KEE LIN
Address	:	58, KAMPUNG PARIT AMAT, MUKIM 5, 83050 BATU PAHAT, JOHOR, MALAYSIA.
Other Address(es)	:	- PARIT AMAT, PARIT BILAL, PENGGARAM, 83000 BATU PAHAT, JOHOR, MALAYSIA.
IC / PP No	:	A0014176
New IC No	:	641228-01-5103
Date of Birth	:	28/12/1964
Nationality	:	MALAYSIAN
Date of Appointment	:	15/12/2000

MANAGEMENT

1)	Name of Subject	:	SIOW CHEW KIONG
	Position	:	MANAGING DIRECTOR

AUDITOR

Auditor	:	T.C. CHEW & CO.
Auditor' Address	:	15A, JALAN SULAIMAN, 83000 BATU PAHAT, JOHOR, MALAYSIA.

COMPANY SECRETARIES

1)	Company Secretary	:	MS. HO SIEW BEE
	IC / PP No	:	7418238
	New IC No	:	640909-01-5278
	Address	:	2, LORONG C, JALAN MESJID, 83000 BATU PAHAT, JOHOR, MALAYSIA.

BANKING

Banking relations are maintained principally with :

1)

Name

:

ALLIANCE BANK MALAYSIA BHD

2)

Name

:

AMBANK (M) BHD

3)

Name

:

CIMB BANK BHD

4)

Name

:

EON BANK BHD

5)

Name

:

HONG LEONG BANK BHD

6)

Name

:

OCBC BANK (MALAYSIA) BHD

ENCUMBRANCE (S)

Charge No	Creation Date	Charge Description	Chargee Name	Total Charge	Status
1	30/06/2003	FACILITIES AGREEMENT & LEGAL CHARGE	EON BANK BERHAD	MYR 1,608,000.00	Unsatisfied
2	12/02/2004	FACILITIES AGREEMENT & DEBENTURE	EON BANK BERHAD	MYR 571,000.00	Unsatisfied
3	25/03/2005	FIXED CHARGE	EON BANK BERHAD	MYR 545,000.00	Unsatisfied
4	26/07/2005	FACILITIES AGREEMENT & DEBENTURE	EON BANK BERHAD	MYR 1,000,000.00	Unsatisfied
5	13/10/2005	FACILITIES AGREEMENT & DEBENTURE	EON BANK BERHAD	MYR 1,000,000.00	Unsatisfied
6	07/02/2006	FACILITIES AGREEMENT & DEBENTURE	EON BANK BERHAD	MYR 1,000,000.00	Unsatisfied
7	27/03/2006	FACILITIES AGREEMENT & LEGAL CHARGE	EON BANK BERHAD	MYR 192,000.00	Unsatisfied
8	20/08/2007	FIXED CHARGE	EON BANK BERHAD	MYR 16,778,000.00	Unsatisfied
9	30/06/2008	DEBENTURE	OCBC BANK (MALAYSIA) BERHAD	MYR 33,750.24	Satisfied
10	21/10/2008	FIXED CHARGE	EON BANK BERHAD	MYR 3,500,000.00	Unsatisfied
11	05/08/2009	FACILITY AGREEMENT & DEPOSIT	ALLIANCE BANK MALAYSIA BERHAD	-	Unsatisfied
12	18/11/2009	FACILITIES AGREEMENT & LEGAL CHARGE	EON BANK BERHAD	MYR 235,000.00	Unsatisfied
13	13/04/2010	TERM LOAN AGREEMENT & DEBENTURE	ALLIANCE BANK MALAYSIA BERHAD	-	Unsatisfied
14	29/06/2010	FACILITIES AGREEMENT & LEGAL CHARGE	EON BANK BERHAD	MYR 1,270,000.00	Unsatisfied
15	29/12/2010	SPECIFIC DEBENTURE	AMBANK (M) BERHAD	MYR 2,000,000.00	Unsatisfied
16	15/07/2011	MEMORANDUM OF DEPOSIT OF FIXED DEPOSIT RECEIPT	CIMB BANK BERHAD	-	Unsatisfied
17	17/08/2011	SPECIFIC DEBENTURE	AMBANK (M) BERHAD	MYR 2,000,000.00	Unsatisfied
18	17/08/2011	SPECIFIC DEBENTURE	AMBANK (M) BERHAD	MYR 2,000,000.00	Unsatisfied
19	21/10/2011	SPECIFIC DEBENTURE	AMBANK (M) BERHAD	MYR 2,000,000.00	Unsatisfied
20	24/11/2011	FACILITIES AGREEMENT & LEGAL CHARGE	HONG LEONG BANK BERHAD	MYR 5,000,000.00	Unsatisfied
21	06/08/2012	SPECIFIC DEBENTURE	HONG LEONG BANK BERHAD	-	Unsatisfied
22	07/11/2012	LEGAL CHARGE	HONG LEONG BANK BERHAD	-	Unsatisfied
23	07/11/2012	LEGAL CHARGE	HONG LEONG BANK BERHAD	-	Unsatisfied
24	07/11/2012	LEGAL CHARGE	HONG LEONG BANK BERHAD	-	Unsatisfied
25	07/11/2012	DEED OF ASSIGNMENT	HONG LEONG BANK BERHAD	-	Unsatisfied
26	07/11/2012	LEGAL CHARGE	HONG LEONG BANK BERHAD	-	Unsatisfied
27	28/10/2013	FIXED CHARGE	AMBANK (M) BERHAD	MYR 3,000,000.00	Unsatisfied
28	06/04/2014	DEBENTURE	AMBANK (M) BERHAD	MYR 2,500,000.00	Unsatisfied
29	20/05/2014	DEBENTURE	AMBANK (M) BERHAD	MYR 2,500,000.00	Unsatisfied
30	23/06/2014	DEED OF ASSIGNMENT	ALLIANCE BANK MALAYSIA BERHAD	-	Unsatisfied
31	28/01/2015	DEBENTURE	AMBANK (M) BERHAD	MYR 2,500,000.00	Unsatisfied

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	:	YES	Percentage	:	70%
Overseas	:	YES	Percentage	:	30%
Import Countries	:	ASIA

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	[	X	]	Average 61-90 Days	[	]
Fair 91-120 Days	[	]	Poor >120 Days	[		]

CLIENTELE

Local	:	YES
Domestic Markets	:	MALAYSIA
Overseas	:	YES	Percentage	:	30%
Export Market	:	SINGAPORE AUSTRALIA ASIA
Credit Term	:	60 - 90 DAYS
Payment Mode	:	TELEGRAPHIC TRANSFER (TT) CHEQUES

OPERATIONS

Products manufactured

:

LASTIC PACKAGING MATERIALS, STRETCH FILM, PE FOAM SHEET, OPP TAPES, PLASTIC BAGS, AIR BUBBLE & ADHESIVE TAPES

Product Brand Name

:

MASTER WRAP.ELITE WRAP

Award

:

1 ) ISO 14001:2004 Year :2007
2 ) ISO 9001:2000 Year :2003

Member(s) / Affiliate(s)

:

SMALL & MEDIUM ENTERPRISE

Ownership of premises

:

OWNED

Production Capacity

:

1200 METRIC TON MONTHLY

Total Number of Employees:
YEAR	2015	2014	2013	2012	2011
GROUP	N/A	N/A	N/A	N/A	N/A
COMPANY	200	200	200	230	220

Branch

:

NO

Other Information:

The Subject is principally engaged in the (as a / as an) manufacturing of plastic packaging materials, stretch film, pe foam sheet, opp tapes, plastic bags, air bubble & adhesive tapes.

The products range includes plastic bags, pallet stretch films, PE foam, air bubble and all kinds of adhesive tapes.

The Subject's production divisions consist of tape and stretch film department, PE Sheet/bag department, air bubble machine, plastic department, resin mixture and others.

The production machines include tape cutting machine, TSR machine, air bubble machine, cutting machine and others.

CURRENT INVESTIGATION

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client	:	N/A
Current Telephone Number	:	07-4101188
Match	:	N/A
Address Provided by Client	:	26-30, JALAN SRI SULONG 19/A, TAMAN INDUSTRI SRI SULONG, 83020 BATU PAHAT, JOHOR, MALAYSIA.
Current Address	:	26-30, JALAN SRI SULONG 19/A, TAMAN INDUSTRI SRI SULONG, 83020 BATU PAHAT, JOHOR, MALAYSIA.
Match	:	YES
Latest Financial Accounts	:	YES

Other Investigations

We contacted one of the staff from the Subject and he provided some information.

FINANCIAL ANALYSIS

Profitability
Turnover	:	Erratic	[	2010 - 2014	]
Profit/(Loss) Before Tax	:	Decreased	[	2010 - 2014	]
Return on Shareholder Funds	:	Acceptable	[	12.42%	]
Return on Net Assets	:	Acceptable	[	15.44%	]
The fluctuating turnover reflects the fierce competition among the existing and new market players.The dip in profit could be due to the stiff market competition which reduced the Subject's profit margin. The Subject's management had generated acceptable return for its shareholders using its assets.
Working Capital Control
Stock Ratio	:	Favourable	[	55 Days	]
Debtor Ratio	:	Acceptable	[	59 Days	]
Creditors Ratio	:	Favourable	[	7 Days	]
The Subject's stocks were moving fast thus reducing its holding cost. This had reduced funds being tied up in stocks. The Subject's management was quite efficient in handling its debtors. The Subject's debtors days were at an acceptable range, thus the risk of its debts turning bad was minimised. 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	[	0.94 Times	]
Current Ratio	:	Unfavourable	[	1.32 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	[	2.67 Times	]
Gearing Ratio	:	Favourable	[	0.56 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. 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. 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 : FAIR

MALAYSIA ECONOMIC / INDUSTRY OUTLOOK

Major Economic Indicators:	2011	2012	2013	2014*	2015**
Population ( Million)	28.7	29.3	29.8	30.3	30.5
Gross Domestic Products ( % )	5.1	5.6	5.3	6.0	6.0
Domestic Demand ( % )	8.2	9.4	5.6	6.4	6.2
Private Expenditure ( % )	8.2	8.0	8.6	7.9	6.9
Consumption ( % )	7.1	1.0	5.7	6.5	5.6
Investment ( % )	12.2	11.7	13.3	12.0	10.7
Public Expenditure ( % )	8.4	13.3	4.4	2.3	4.2
Consumption ( % )	16.1	11.3	(1.2)	2.1	3.8
Investment ( % )	(0.3)	15.9	4.2	2.6	4.7
Balance of Trade ( MYR Million )	116,058	106,300	71,298	52,314	-
Government Finance ( MYR Million )	(45,511)	(42,297)	(39,993)	(37,291)	-
Government Finance to GDP / Fiscal Deficit ( % )	(5.4)	(4.5)	(4.0)	(3.5)	(3.0)
Inflation ( % Change in Composite CPI)	3.1	1.6	2.5	3.2	4.0
Unemployment Rate	3.3	3.2	3.0	2.9	3.0
Net International Reserves ( MYR Billion )	415	427	-	417	-
Average Risk-Weighted Capital Adequacy Ratio ( % )	3.50	2.20	-	4.00	-
Average 3 Months of Non-performing Loans ( % )	14.80	14.70	-	-	-
Average Base Lending Rate ( % )	6.60	6.53	6.53	6.85	-
Business Loans Disbursed( % )	15.3	32.2	-	56.0	-
Foreign Investment ( MYR Million )	23,546.1	26,230.4	38,238.0	43,486.6	-
Consumer Loans ( % )	-	-	-	-	-
Registration of New Companies ( No. )	45,455	45,441	46,321	49,144	-
Registration of New Companies ( % )	3.0	(0.0)	1.9	6.1	-
Liquidation of Companies ( No. )	132,485	17,092	26,430	21,753	-
Liquidation of Companies ( % )	417.8	(87.1)	54.6	(17.7)	-
Registration of New Business ( No. )	284,598	324,761	329,895	332,723	-
Registration of New Business ( % )	5.0	14.0	2.0	1.0	-
Business Dissolved ( No. )	20,121	20,380	18,161	21,436	-
Business Dissolved ( % )	1.9	1.3	(10.9)	18.0	-
Sales of New Passenger Cars (' 000 Unit )	535.1	552.2	576.7	598.4	610.3
Cellular Phone Subscribers ( Million )	35.3	38.5	43.0	43.8	-
Tourist Arrival ( Million Persons )	24.7	25.0	25.7	28.0	-
Hotel Occupancy Rate ( % )	60.6	62.4	62.6	63.2	-
Credit Cards Spending ( % )	15.6	12.6	-	13.5	-
Bad Cheque Offenders (No.)	32,627	26,982	28,876	-	-
Individual Bankruptcy ( No.)	19,167	19,575	21,984	-	-
Individual Bankruptcy ( % )	5.8	2.1	12.3	-	-

INDUSTRIES ( % of Growth ):	2011	2012	2013	2014*	2015**
Agriculture	5.8	1.0	2.1	3.8	3.1
Palm Oil	10.8	(0.3)	2.6	6.7	-
Rubber	6.1	(7.9)	(10.1)	(10.4)	-
Forestry & Logging	(7.6)	(4.5)	(7.8)	(4.2)	-
Fishing	2.1	4.3	1.6	2.7	-
Other Agriculture	7.1	6.4	8.2	6.2	-
Industry Non-Performing Loans ( MYR Million )	634.1	-	-	-	-
% of Industry Non-Performing Loans	3.2	-	-	-	-
Mining	(5.4)	1.4	0.9	(0.8)	2.8
Oil & Gas	(1.7)	-	-	3.0	-
Other Mining	-	-	-	46.6	-
Industry Non-performing Loans ( MYR Million )	46.5	-	-	-	-
% of Industry Non-performing Loans	0.1	-	-	-	-
Manufacturing #	4.7	4.8	3.4	6.4	5.5
Exported-oriented Industries	4.1	6.5	3.3	5.6	-
Electrical & Electronics	(4.0)	12.7	6.9	13.3	-
Rubber Products	20.7	3.0	11.7	(0.3)	-
Wood Products	(5.1)	8.7	(2.7)	5.1	-
Textiles & Apparel	13.2	(7.1)	(2.6)	11.5	-
Domestic-oriented Industries	10.7	1.7	6.8	9.4	-
Food, Beverages & Tobacco	4.80	2.70	3.60	6.13	6.13
Chemical & Chemical Products	10.0	10.8	5.6	1.4	-
Plastic Products	3.8	-	-	2.7	-
Iron & Steel	2.2	(6.6)	5.0	0.1	-
Fabricated Metal Products	21.8	13.8	9.9	2.9	-
Non-metallic Mineral	12.1	2.9	(2.0)	5.4	-
Transport Equipment	12.0	3.4	13.8	22.9	-
Paper & Paper Products	9.5	3.1	1.8	4.7	-
Crude Oil Refineries	9.3	-	-	13.0	-
Industry Non-Performing Loans ( MYR Million )	6,537.2	-	-	-	-
% of Industry Non-Performing Loans	25.7	-	-	-	-
Construction	4.7	18.6	10.9	12.7	10.7
Industry Non-Performing Loans ( MYR Million )	3,856.9	-	-	-	-
% of Industry Non-Performing Loans	10.2	-	-	-	-
Services	7.1	6.4	5.9	5.9	5.6
Electric, Gas & Water	3.5	4.4	4.2	3.6	3.9
Transport, Storage & Communication	6.50	7.10	7.30	7.50	7.15
Wholesale, Retail, Hotel & Restaurant	5.2	4.7	5.9	6.9	6.5
Finance, Insurance & Real Estate	6.90	9.70	3.70	4.65	4.25
Government Services	12.4	9.4	8.3	6.1	5.6
Other Services	5.1	3.9	5.1	4.8	4.5
Industry Non-Performing Loans ( MYR Million )	6,825.2	-	-	-	-
% of Industry Non-Performing Loans	23.4	-	-	-	-
* Estimate / Preliminary
** Forecast
# Based On Manufacturing Production Index

INDUSTRY ANALYSIS

MSIC CODE
22204 : Manufacture of builders' plastics ware
INDUSTRY :	MANUFACTURING
The manufacturing sector is expected to grow by 5.5% in 2015. It will be bolstered by strong domestic and export-oriented industries in line with growing investment activities and favorable external demand. Moreover, in 2014, the manufacturing sectors have spearheading growth. The manufacturing sector is estimated to grow at a faster pace in 2014 on higher exports of electronics and electrical (E&E) products as external demand improves.
The manufacturing sector expanded strongly during the first half of 2014, the highest growth in three years, spurred by higher global semiconductor sales. Value-added of the manufacturing sector expanded 7.1% during the first half of 2014. Production of the sector rose 6.6% in the first seven months of 2014 supported by resilient domestic demand and recovery in the external sector during the first seven months of the years. The sales value of manufactured products rebounded by 7.7% in the first seven months of 2014. The strong performance of the sector was on account of higher output at 9.4% from the domestic-oriented industries, particularly transport equipment, food and beverage.
The manufacturing sector continued to attract domestic and foreign investment with investment approved by Malaysian Investment Development Authority (MIDA) totaling RM47.4 billion during the first six months of 2014, mainly from Japan, China and Germany. Meanwhile, the capacity utilization rate remained steady at 80.4% during the second quarter of 2014 while average wage per employee and productivity improved to RM2,772 per month and 5.9%, respectively during the first seven months of 2014. Boosted by favorable domestic economic activity and recovery in the external sector, the manufacturing sector is expected to record a better performance with growth of 6.4% in 2014.
In the meantime, production of wood products rebounded by 5.1% largely supported by higher output in the saw-milling and planning of wood segment at 25.9% during the first seven months of 2014. The positive performance was attributed to vibrant residential and commercial construction activities which contributed to increased use of timber frame and glued laminated timber for cost savings compared to the use of concrete and steel. Increased demand from major export destination such as the US, Japan and Australia for Malaysian made furniture contributed to the higher output, particularly wooden and cane furniture which rebounded by 2.2%.
Production of rubber products contracted 0.3% in the first seven months of 2014 on account of slower demand for rubber gloves and rubber tyres. The decline in rubber tyres for vehicles was due to the weaker external demand from the automotive industry, particularly from China. Output of other rubber products contracted 3.8% following the product shift from rubber-based to plastics, silicones and metal alloys in the manufacture of medical devices.
Besides, exports of manufactured products are expected to grow 6.1% in 2014 boosted by the growing demand from advanced economies. However, during the first seven months of 2014, manufactured exports surged 11.4%. The robust growth was buoyed by strengthening demand in the US and EU, reflecting significant exposure of Malaysian exports to the economic performance in the advance economies. The strength in export was broad-based with robust growth in both E&E and non- E&E subsectors.
Under budget 2015, the Government will provide incentive in the form of capital allowance on automation expenditure to encourage automation in the manufacturing sector, which may help in the manufacturing sector.
OVERALL INDUSTRY OUTLOOK : Average Growth

CREDIT RISK EVALUATION & RECOMMENDATION

Incorporated in 1995, the Subject is a Private Limited company, focusing on manufacturing of plastic packaging materials, stretch film, pe foam sheet, opp tapes, plastic bags, air bubble & adhesive tapes. With its long establishment in the market, the Subject has received strong support from its stable customers base. Its business position in the market is quite stable and it is expected to enjoy better market shares over its rivals. A paid up capital of MYR 4,000,000 allows the Subject to expand its business more comfortably. With a strong backing from its holding company, the Subject enjoys timely financial assistance should the needs arise.

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.

The Subject's business performance showed a reverse trend as both its turnover and pre-tax profit have decreased compared to the previous year. Return on shareholders' funds of the Subject was at an acceptable range which indicated that the management was efficient in utilising its funds to generate income. The Subject 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 22,026,901, the Subject should be able to maintain its business in the near terms.

The Subject's supplier are from both the local and overseas countries. This will eliminates the risk of dependency on deliveries from a number of key suppliers and insufficient quantities of its raw materials. Overall the Subject has a good control over its resources.

Overall, the Subject's payment habit is good as the Subject has a good credit control and it could be taking advantage of the cash discounts while maintaining a good reputation with its creditors.

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)

EB PACKAGING SDN. BHD.

Financial Year End	2014-10-31	2013-10-31	2012-10-31	2011-10-31	2010-10-31
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	SUMMARY	FULL	FULL
Currency	MYR	MYR	MYR	MYR	MYR
TURNOVER	85,725,347	87,630,602	7,816,383	52,579,735	57,335,993
Other Income	615,531	409,897	-	551,250	168,377
	----------------	----------------	----------------	----------------	----------------
Total Turnover	86,340,878	88,040,499	7,816,383	53,130,985	57,504,370
Costs of Goods Sold	(76,890,891)	(78,272,690)	-	(46,530,882)	(50,563,201)
	----------------	----------------	----------------	----------------	----------------
Gross Profit	9,449,987	9,767,809	-	6,600,103	6,941,169
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) FROM OPERATIONS	3,000,143	3,202,604	1,741,742	1,363,200	1,619,471
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE TAXATION	3,000,143	3,202,604	1,741,742	1,363,200	1,619,471
Taxation	(263,742)	(139,967)	(150,044)	(74,158)	(101,328)
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) AFTER TAXATION	2,736,401	3,062,637	1,591,698	1,289,042	1,518,143
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported	15,290,500	13,427,863	11,836,165	10,547,123	9,028,980
	----------------	----------------	----------------	----------------	----------------
As restated	15,290,500	13,427,863	11,836,165	10,547,123	9,028,980
	----------------	----------------	----------------	----------------	----------------
PROFIT AVAILABLE FOR APPROPRIATIONS	18,026,901	16,490,500	13,427,863	11,836,165	10,547,123
DIVIDENDS - Ordinary (paid & proposed)	-	(1,200,000)	-	-	-
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD	18,026,901	15,290,500	13,427,863	11,836,165	10,547,123
	=============	=============	=============	=============	=============
INTEREST EXPENSE (as per notes to P&L)
Hire purchase	22,464	28,571	-	58,995	61,153
Letter of credit	669,405	935,878	-	-	-
Term loan / Borrowing	797,105	931,509	-	549,703	490,765
Others	305,688	77,448	-	656,289	514,443
	----------------	----------------	----------------	----------------	----------------
	1,794,662	1,973,406	-	1,264,987	1,066,361
	=============	=============	-	=============	=============
DEPRECIATION (as per notes to P&L)	2,763,322	2,767,143	-	1,610,480	1,416,606
	----------------	----------------	----------------	----------------	----------------
	2,763,322	2,767,143	-	1,610,480	1,416,606
	=============	=============	=============	=============	=============

BALANCE SHEET

EB PACKAGING SDN. BHD.

ASSETS EMPLOYED:
FIXED ASSETS	20,648,765	21,879,461	24,052,657	14,388,352	13,487,336
Others	-	-	-	160,000	164,000
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS	-	-	-	160,000	164,000
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM ASSETS	20,648,765	21,879,461	24,052,657	14,548,352	13,651,336
Stocks	12,302,241	9,811,734	-	9,535,207	8,007,235
Contract work-in-progress	513,415	994,877	-	-	-
Trade debtors	13,798,963	14,747,377	-	11,421,172	16,336,055
Other debtors, deposits & prepayments	6,652,286	2,909,621	-	1,932,897	825,531
Short term deposits	4,983,060	3,832,562	-	3,603,513	3,500,429
Amount due from holding company	1,800,110	5,867,582	-	474,579	-
Cash & bank balances	2,409,673	1,735,464	-	1,230,749	357,688
Others	-	-	-	280,669	204,827
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT ASSETS	42,459,748	39,899,217	31,768,145	28,478,786	29,231,765
	----------------	----------------	----------------	----------------	----------------
TOTAL ASSET	63,108,513	61,778,678	55,820,802	43,027,138	42,883,101
	=============	=============	=============	=============	=============
CURRENT LIABILITIES
Trade creditors	1,457,175	1,947,971	-	2,166,936	3,654,704
Other creditors & accruals	1,208,524	1,453,845	-	1,141,948	1,015,310
Hire purchase & lease creditors	217,859	408,335	-	545,177	992,665
Bank overdraft	636,112	133,573	-	106,477	-
Short term borrowings/Term loans	2,522,703	2,549,590	-	1,238,541	1,049,270
Deposits & balances of banks & agents	2,350	2,350	-	-	-
Amounts owing to holding company	-	-	-	-	301,077
Amounts owing to director	-	-	-	6,000	36,000
Provision for taxation	126,300	2,600	-	-	-
Other liabilities	25,881,033	25,458,687	-	15,908,350	15,589,350
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	32,052,056	31,956,951	26,311,699	21,113,429	22,638,376
	----------------	----------------	----------------	----------------	----------------
NET CURRENT ASSETS/(LIABILITIES)	10,407,692	7,942,266	5,456,446	7,365,357	6,593,389
	----------------	----------------	----------------	----------------	----------------
TOTAL NET ASSETS	31,056,457	29,821,727	29,509,103	21,913,709	20,244,725
	=============	=============	=============	=============	=============
SHARE CAPITAL
Ordinary share capital	4,000,000	4,000,000	3,000,000	3,000,000	3,000,000
	----------------	----------------	----------------	----------------	----------------
TOTAL SHARE CAPITAL	4,000,000	4,000,000	3,000,000	3,000,000	3,000,000
Retained profit/(loss) carried forward	18,026,901	15,290,500	13,427,863	11,836,165	10,547,123
	----------------	----------------	----------------	----------------	----------------
TOTAL RESERVES	18,026,901	15,290,500	13,427,863	11,836,165	10,547,123
	----------------	----------------	----------------	----------------	----------------
SHAREHOLDERS' FUNDS/EQUITY	22,026,901	19,290,500	16,427,863	14,836,165	13,547,123
Long term loans	9,029,556	10,531,227	-	7,077,544	6,697,602
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	9,029,556	10,531,227	13,081,240	7,077,544	6,697,602
	----------------	----------------	----------------	----------------	----------------
	31,056,457	29,821,727	29,509,103	21,913,709	20,244,725
	=============	=============	=============	=============	=============

FINANCIAL RATIO

EB PACKAGING SDN. BHD.

TYPES OF FUNDS
Cash	7,392,733	5,568,026	-	4,834,262	3,858,117
Net Liquid Funds	6,756,621	5,434,453	-	4,727,785	3,858,117
Net Liquid Assets	(1,894,549)	(1,869,468)	5,456,446	(2,169,850)	(1,413,846)
Net Current Assets/(Liabilities)	10,407,692	7,942,266	5,456,446	7,365,357	6,593,389
Net Tangible Assets	31,056,457	29,821,727	29,509,103	21,913,709	20,244,725
Net Monetary Assets	(10,924,105)	(12,400,695)	(7,624,794)	(9,247,394)	(8,111,448)
PROFIT & LOSS ITEMS
Earnings Before Interest & Tax (EBIT)	4,794,805	5,176,010	-	2,628,187	2,685,832
Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)	7,558,127	7,943,153	-	4,238,667	4,102,438
BALANCE SHEET ITEMS
Total Borrowings	12,406,230	13,622,725	-	8,967,739	8,739,537
Total Liabilities	41,081,612	42,488,178	39,392,939	28,190,973	29,335,978
Total Assets	63,108,513	61,778,678	55,820,802	43,027,138	42,883,101
Net Assets	31,056,457	29,821,727	29,509,103	21,913,709	20,244,725
Net Assets Backing	22,026,901	19,290,500	16,427,863	14,836,165	13,547,123
Shareholders' Funds	22,026,901	19,290,500	16,427,863	14,836,165	13,547,123
Total Share Capital	4,000,000	4,000,000	3,000,000	3,000,000	3,000,000
Total Reserves	18,026,901	15,290,500	13,427,863	11,836,165	10,547,123
LIQUIDITY (Times)
Cash Ratio	0.23	0.17	-	0.23	0.17
Liquid Ratio	0.94	0.94	-	0.90	0.94
Current Ratio	1.32	1.25	1.21	1.35	1.29
WORKING CAPITAL CONTROL (Days)
Stock Ratio	55	45	-	66	51
Debtors Ratio	59	61	-	79	104
Creditors Ratio	7	9	-	17	26
SOLVENCY RATIOS (Times)
Gearing Ratio	0.56	0.71	-	0.60	0.65
Liabilities Ratio	1.87	2.20	2.40	1.90	2.17
Times Interest Earned Ratio	2.67	2.62	-	2.08	2.52
Assets Backing Ratio	7.76	7.46	9.84	7.30	6.75
PERFORMANCE RATIO (%)
Operating Profit Margin	3.50	3.65	22.28	2.59	2.82
Net Profit Margin	3.19	3.49	20.36	2.45	2.65
Return On Net Assets	15.44	17.36	5.90	11.99	13.27
Return On Capital Employed	15.03	17.05	5.90	11.65	12.65
Return On Shareholders' Funds/Equity	12.42	15.88	9.69	8.69	11.21
Dividend Pay Out Ratio (Times)	0	0.39	-	0	0
NOTES TO ACCOUNTS
Contingent Liabilities	0	0	-	0	0

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.66.62
UK Pound	1	Rs.100.34
Euro	1	Rs.70.67
MYR	1	Rs.15.79

Note : Above are approximate rates obtained from sources believed to be correct

INFORMATION DETAILS

Analysis Done by :	TRI
Report Prepared by :	NIT

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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