MIRA INFORM REPORT

 

 

Report No. :

352336

Report Date :

04.12.2015

 

IDENTIFICATION DETAILS

 

Name :

TAI OHM ELECTRONICS (M) SDN. BHD.

 

 

Formerly Known As :

CRESCENT LINE SDN BHD

 

 

Registered Office :

Suite 12-02, Menara Zurich, 170, Jalan Argyll, 12th Floor, 10050 Pulau Pinang, Pulau Pinang

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2014

 

 

Date of Incorporation :

23.10.1989

 

 

Com. Reg. No.:

188441-H

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Subject is engaged in the manufacturer of wire forms, thick film chip resistors, carbon film & metal film fixed resistors.

 

 

No. of Employees :

Not Available

 

 

 

 

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 :

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 – 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.

:

188441-H

COMPANY NAME

:

TAI OHM ELECTRONICS (M) SDN. BHD.

FORMER NAME

:

CRESCENT LINE SDN BHD (16/03/1990)

INCORPORATION DATE

:

23/10/1989

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

SUITE 12-02, MENARA ZURICH, 170, JALAN ARGYLL, 12TH FLOOR, 10050 PULAU PINANG, PULAU PINANG, MALAYSIA.

BUSINESS ADDRESS

:

564-D, LORONG PERUSAHAAN BARU 2, PRAI INDUSTRIAL PARK, 13600 PRAI, PULAU PINANG, MALAYSIA.

TEL.NO.

:

04-3900480

FAX.NO.

:

04-3994300

WEB SITE

:

WWW.TAIOHM.COM.MY

CONTACT PERSON

:

LIN TAI SAN ( DIRECTOR )

INDUSTRY CODE

:

26103

PRINCIPAL ACTIVITY

:

MANUFACTURER OF WIRE FORMS, THICK FILM CHIP RESISTORS, CARBON FILM & METAL FILM FIXED RESISTORS

AUTHORISED CAPITAL

:

MYR 6,000,000.00 DIVIDED INTO 
ORDINARY SHARE 6,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 2,626,005.00 DIVIDED INTO 
ORDINARY SHARES 2,626,005 CASH OF MYR 1.00 EACH.

SALES

:

MYR 22,476,783 [2014]

NET WORTH

:

MYR 16,152,263 [2014]

STAFF STRENGTH

:

N/A

BANKER (S)

:

RHB BANK BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

FAIR

PAYMENT

:

AVERAGE

MANAGEMENT CAPABILITY

:

AVERAGE

COMMERCIAL RISK

:

LOW

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

SATISFACTORY

INDUSTRY OUTLOOK

:

MARGINAL 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 wire forms, thick film chip resistors, carbon film & metal film fixed resistors.

 

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

 

Former Address(es)

Address

As At Date

PLOT 564-D,LRG.PERUSAHAAN BARU DUA, KAW.PERUSAHAAN PRAI, 13600, PULAU PINANG, MALAYSIA

15/02/2013

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

30/06/2015

MYR 6,000,000.00

MYR 2,626,005.00

03/09/1990

MYR 6,000,000.00

MYR 1,747,984.00

26/10/1989

MYR 25,000.00

MYR 2.00

 

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

 

Current Shareholder(s) :

Name

Address

IC/PP/Loc No

Shareholding

(%)

CHIANG TSAI PAO +

346N, LENGKOK PEMANCAR, 11700 GELUGOR, PULAU PINANG, MALAYSIA.

133003302

502,224.00

19.13

WANG CHIN-RONG +

17, HSIN CHUAN TZU, TAOYUAN, TAIWAN.

132363163

502,224.00

19.13

LIN TAI SAN +

346N, LENGKOK PEMANCAR, 11700 GELUGOR, PULAU PINANG, MALAYSIA.

135170313

334,816.00

12.75

TA-I TECHNOLOGY CO.LTD.

NO. 26, LANE 470, NAN-SHAN ROAD, SEC.2, LU-CHU HSIANG, TAOYUAN, TAIWAN, R.O.C.

XLZ00212187

1,286,741.00

49.00

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

------

2,626,005.00

100.00

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

=====

 

+ Also Director

 

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


Local No

Country

Company

Status

(%)

As At

186851M

MALAYSIA

TAI OHM MARKETING (M) SDN. BHD.

-

4.00

26/11/2014

 

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

LIN TAI SAN

Address

:

346N, LENGKOK PEMANCAR, 11700 GELUGOR, PULAU PINANG, MALAYSIA.

IC / PP No

:

135170313

Nationality

:

TAIWANESE

Date of Appointment

:

13/02/1990

 

DIRECTOR 2

 

Name Of Subject

:

CHIANG TSAI PAO

Address

:

346N, LENGKOK PEMANCAR, 11700 GELUGOR, PULAU PINANG, MALAYSIA.

IC / PP No

:

133003302

Nationality

:

TAIWANESE

Date of Appointment

:

20/03/1990

 

DIRECTOR 3

 

Name Of Subject

:

WANG CHIN-RONG

Address

:

17, HSIN CHUAN TZU, TAOYUAN, TAIWAN.

IC / PP No

:

132363163

Nationality

:

TAIWANESE

Date of Appointment

:

19/03/1990



MANAGEMENT

 

 

1)

Name of Subject

:

LIN TAI SAN

Position

:

DIRECTOR

 

AUDITOR

 

Auditor

:

DELOITTE

Auditor' Address

:

HUNZA TOWER, 163E KELAWEI ROAD, LEVEL 12A, 10250 GEORGETOWN, PULAU PINANG, MALAYSIA.

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. GUNN CHIT GEOK

IC / PP No

:

3455868

New IC No

:

490915-07-5030

Address

:

23, PERSIARAN MIDLANDS, 10250 GEORGETOWN, PULAU PINANG, MALAYSIA.

 

2)

Company Secretary

:

MS. CHEW SIEW CHENG

IC / PP No

:

A2170032

New IC No

:

720405-07-5218

Address

:

1-V, LORONG DELIMA 17, ISLAND GLADES, 11700 GELUGOR, PULAU PINANG, MALAYSIA.

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

RHB BANK BHD

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

25/09/1990

N/A

DEVELOPMENT COMMERCIAL BANK BHD

MYR 400,000.00

Unsatisfied

2

03/12/1992

N/A

DEVELOPMENT AND COMMERCIAL BANK BHD

MYR 1,060,000.00

Satisfied

3

01/02/1996

DEBENTURE BY WAY OF FIXED AND FLOATING CHARGE

DCB BANK BERHAD

MYR 1,200,000.00

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

:

N/A

Overseas

:

N/A


The Subject refused to disclose its suppliers. 

The Subject refused to provide any name of trade/service supplier and we are unable to conduct any trade enquiry. However, from financial historical data we conclude that :

OVERALL PAYMENT HABIT

Prompt 0-30 Days

[

]

Good 31-60 Days

[

]

Average 61-90 Days

[

X

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

ASIA

Credit Term

:

N/A

Payment Mode

:

CHEQUES
TELEGRAPHIC TRANSFER (TT)

 

OPERATIONS

 

Products manufactured

:

RESISTORS

Member(s) / Affiliate(s)

:

SMI ASSOCIATION OF MALAYSIA

Production Line

:

7 LINES

Production Capacity

:

AROUND 300 MILLION PIECES PER MONTH

Shifts

:

2 SHIFTS

 

Total Number of Employees:

YEAR

2014

GROUP

N/A

COMPANY

80

 

Branch

:

NO

 

Other Information:


The Subject is principally engaged in the (as a / as an) manufacturer of wire forms, thick film chip resistors, carbon film & metal film fixed resistors. 

The Subject is engaged in the manufacturing of resistors for the electronic industries.



CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

043900480

Current Telephone Number

:

04-3900480

Match

:

YES

Address Provided by Client

:

564-D, LORONG PERUSAHAAN BARU 2, PRAI INDUSTRIAL PARK,13600,PERAI,PULAU PINANG.

Current Address

:

564-D, LORONG PERUSAHAAN BARU 2, PRAI INDUSTRIAL PARK, 13600 PRAI, PULAU PINANG, MALAYSIA.

Match

:

YES

Latest Financial Accounts

:

YES

 

Other Investigations


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

The Subject refused to disclose its number of employees.


 

FINANCIAL ANALYSIS

 

Profitability

Turnover

:

Erratic

[

2010 - 2014

]

Profit/(Loss) Before Tax

:

Increased

[

2010 - 2014

]

Return on Shareholder Funds

:

Acceptable

[

13.05%

]

Return on Net Assets

:

Acceptable

[

16.42%

]

The fluctuating turnover reflects the fierce competition among the existing and new market players.The Subject's management have been efficient in controlling its operating costs. The Subject's management had generated acceptable return for its shareholders using its assets.

Working Capital Control

Stock Ratio

:

Acceptable

[

59 Days

]

Debtor Ratio

:

Unfavourable

[

68 Days

]

Creditors Ratio

:

Unfavourable

[

99 Days

]

The Subject kept adequate stocks to meet its normal business transactions without incurring excessive storage costs. The high debtors' ratio could indicate that the Subject was weak in its credit control. However, the Subject could also giving longer credit periods to its customers in order to boost its sales or to capture / retain its market share. The unfavourable creditors' ratio could be due to the Subject taking advantage of the credit granted by its suppliers. However this may affect the goodwill between the Subject and its suppliers and the Subject may inadvertently have to pay more for its future supplies.

Liquidity

Liquid Ratio

:

Acceptable

[

0.95 Times

]

Current Ratio

:

Unfavourable

[

1.44 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

:

Favourable

[

295.66 Times

]

Gearing Ratio

:

Favourable

[

0.01 Times

]

The interest cover showed that the Subject was able to service the interest. The favourable interest cover could indicate that the Subject was making enough profit to pay for the interest accrued. The Subject had no gearing and hence it had virtually no financial risk. The Subject was financed by its shareholders' funds and internally generated fund. During the economic downturn, the Subject, having a zero gearing, will be able to compete better than those which are highly geared in the same industry.

Overall Assessment :

Although the turnover was erratic, the Subject had maintained a steady growth in its profit. This indicate the management's efficiency in controlling its costs and profitability. 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. With the favourable interest cover, the Subject could be able to service all the accrued interest without facing any difficulties. 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

26103 : Manufacture of electrical capacitors and resistors

INDUSTRY :

ELECTRICAL & ELECTRONIC

The electrical & electronics (E&E) industry is the leading subsector in Malaysia's manufacturing sector, contributing significantly to the country's exports (32.8 %) and employment (27.2 %) in 2013. E&E products have been the largest traded items for Malaysia for several decades since the industry inception in the 1960s. The E&E industry in Malaysia is focused on strengthening the three major ecosystems of semiconductors, solar and LED technologies.

In the E&E subsector, production grew more strongly by 13.3% during the first seven months of 2014 mainly driven by electronic components, communication equipment and domestic appliances. The output of printed circuit boards and semiconductor devices rose in line with the growing demand for consumer electronics, particularly mobile devices, as well as improving global PC sales. Early in 2014, global PC sales rose on a moderating trend due to the replacement of PCs with a new operating system. Prices of PCs are also falling, narrowing the price differential with tablets. In contrast, the output of general-purpose machinery decreased 8.8% on account of the decline in manufacture of air-conditioning machine as well as lifting and handling equipment.

Malaysia being a part of the global E&E production network that stands to gain from the stronger growth in worldwide semiconductor sales. In 2015, the export-oriented industries, particularly the E&E subsector will benefit from the improvement in external conditions in line with improving global growth. The E&E subsector is expected to grow further driven by higher demand of semiconductors, electronic components, communication and computer peripherals with the upswing of global electronics demand.

Receipts from E&E products grew at an impressive 10.6% in the first seven months of 2014, rebounding from a contraction of 2.9% in the corresponding period last year. The steady improvement in the global economy, coupled with a pickup in the ICT industry led a surge of 20.1% in export of semiconductor devices. In addition, the robust demand for mid- to low-end smartphones and tablets, notably in emerging markets has driven higher shipments of telecommunication equipment and parts, which turned around with a stronger growth of 30.9% to the US, Netherlands, Singapore and Mexico.

According to Ministry of International Trade and Industry, the healthy growth in the E&E sector will help boost the country's economy. The E&E sector is important to Malaysia. Exports of manufactured goods for September 2014 rose by 2.2 % to RM49.14 billion compared with September 2013, driven by higher exports of E&E products. Hence, gross exports are expected to grow 3.2% in 2015 mainly supported by E&E.

The growth of semiconductor will continue to spearhead the growth of the E&E industry in Malaysia and has benefited from the global demand in the usage of mobile devices, storage devices, and optoelectronics (photonics, fibre optics, LEDs) and embedded technology integrated circuits, PCBs, LEDs. The E&E industry is targeted under the National Key Economic Areas (NKEA) to gear the nation towards high-income economy by focusing on high-value and high-growth manufacturing activities.

OVERALL INDUSTRY OUTLOOK : Marginal Growth



CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 1989, the Subject is a Private Limited company, focusing on manufacturer of wire forms, thick film chip resistors, carbon film & metal film fixed resistors. The Subject has been in business for over two decades. It has built up a strong clientele base and satisfactory reputation will enable the Subject to further enhance its business in the near term. The Subject is expected to enjoy a stable market shares. A paid up capital of MYR 2,626,005 allows the Subject to expand its business more comfortably. With a strong backing from its shareholder, 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. 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. 

Despite the lower turnover, the Subject's pre-tax profit have increased compared to the previous year. The higher profit could be due to better control of its operating costs and efficiency in utilising its resources. 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 16,152,263, the Subject should be able to maintain its business in the near terms. 

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

The industry has reached its maturity stage and only enjoying a marginal growth. The steady growth of the country's economy will further enhance the industry activities. Thus, the Subject's future performance is very much depend on its marketing strategies in order to retain its position in the market. 

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)

TAI OHM ELECTRONICS (M) SDN. BHD.

 

Financial Year End

2014-12-31

2013-12-31

2012-12-31

2011-12-31

2010-12-31

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

22,476,783

23,129,004

19,814,793

21,537,430

17,067,692

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

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

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

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

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

Total Turnover

22,476,783

23,129,004

19,814,793

21,537,430

17,067,692

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

2,674,919

2,569,037

1,129,915

2,511,649

2,099,889

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

2,674,919

2,569,037

1,129,915

2,511,649

2,099,889

Taxation

(566,725)

(652,775)

(472,981)

(338,066)

(390,792)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

2,108,194

1,916,262

656,934

2,173,583

1,709,097

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

11,992,943

10,273,761

10,268,902

8,608,049

7,694,608

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

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

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

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

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

As restated

11,992,943

10,273,761

10,268,902

8,608,049

7,694,608

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

14,101,137

12,190,023

10,925,836

10,781,632

9,403,705

DIVIDENDS - Ordinary (paid & proposed)

(574,879)

(197,080)

(652,075)

(512,730)

(795,656)

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

13,526,258

11,992,943

10,273,761

10,268,902

8,608,049

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Hire purchase

9,078

11,184

11,184

7,111

-

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

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

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

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

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

9,078

11,184

11,184

7,111

-

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

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

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

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

-

DEPRECIATION (as per notes to P&L)

748,206

757,451

785,665

797,464

501,211

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

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

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

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

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

748,206

757,451

785,665

797,464

501,211

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

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

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

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

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

 

 

 

 

 

 

 

BALANCE SHEET

 

TAI OHM ELECTRONICS (M) SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

4,629,901

4,897,971

4,643,209

5,351,818

4,047,607

Investments

8,440,883

7,101,471

5,097,631

7,035,779

6,569,530

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

8,440,883

7,101,471

5,097,631

7,035,779

6,569,530

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

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

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

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

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

TOTAL LONG TERM ASSETS

13,070,784

11,999,442

9,740,840

12,387,597

10,617,137

Stocks

3,621,073

3,723,266

3,035,443

3,801,904

2,978,356

Trade debtors

4,200,992

4,948,318

3,466,793

3,470,920

3,201,092

Other debtors, deposits & prepayments

457,632

657,984

624,787

712,445

346,404

Short term deposits

-

-

-

-

21,125

Cash & bank balances

2,421,721

1,850,223

2,439,575

952,757

759,727

Others

-

-

63,228

-

-

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

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

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

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

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

TOTAL CURRENT ASSETS

10,701,418

11,179,791

9,629,826

8,938,026

7,306,704

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

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

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

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

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

TOTAL ASSET

23,772,202

23,179,233

19,370,666

21,325,623

17,923,841

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

6,086,948

6,689,559

5,185,448

6,968,614

5,378,134

Other creditors & accruals

1,181,692

1,318,382

729,654

887,677

770,419

Hire purchase & lease creditors

55,800

76,734

101,364

101,364

-

Provision for taxation

99,599

159,910

-

21,263

284,234

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

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

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

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

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

TOTAL CURRENT LIABILITIES

7,424,039

8,244,585

6,016,466

7,978,918

6,432,787

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

3,277,379

2,935,206

3,613,360

959,108

873,917

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

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

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

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

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

TOTAL NET ASSETS

16,348,163

14,934,648

13,354,200

13,346,705

11,491,054

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

2,626,005

2,626,005

2,626,005

2,626,005

2,626,005

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

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

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

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

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

TOTAL SHARE CAPITAL

2,626,005

2,626,005

2,626,005

2,626,005

2,626,005

Retained profit/(loss) carried forward

13,526,258

11,992,943

10,273,761

10,268,902

8,608,049

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

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

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

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

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

TOTAL RESERVES

13,526,258

11,992,943

10,273,761

10,268,902

8,608,049

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

16,152,263

14,618,948

12,899,766

12,894,907

11,234,054

Hire purchase creditors

27,900

83,700

160,434

261,798

-

Deferred taxation

168,000

232,000

294,000

190,000

257,000

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

195,900

315,700

454,434

451,798

257,000

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

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

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

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

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

16,348,163

14,934,648

13,354,200

13,346,705

11,491,054

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

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

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

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

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

 

 

 

 

 

 

 

FINANCIAL RATIO

 

TAI OHM ELECTRONICS (M) SDN. BHD.

 

TYPES OF FUNDS

Cash

2,421,721

1,850,223

2,439,575

952,757

780,852

Net Liquid Funds

2,421,721

1,850,223

2,439,575

952,757

780,852

Net Liquid Assets

(343,694)

(788,060)

577,917

(2,842,796)

(2,104,439)

Net Current Assets/(Liabilities)

3,277,379

2,935,206

3,613,360

959,108

873,917

Net Tangible Assets

16,348,163

14,934,648

13,354,200

13,346,705

11,491,054

Net Monetary Assets

(539,594)

(1,103,760)

123,483

(3,294,594)

(2,361,439)

PROFIT & LOSS ITEMS

Earnings Before Interest & Tax (EBIT)

2,683,997

2,580,221

1,141,099

2,518,760

2,099,889

Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)

3,432,203

3,337,672

1,926,764

3,316,224

2,601,100

BALANCE SHEET ITEMS

Total Borrowings

83,700

160,434

261,798

363,162

0

Total Liabilities

7,619,939

8,560,285

6,470,900

8,430,716

6,689,787

Total Assets

23,772,202

23,179,233

19,370,666

21,325,623

17,923,841

Net Assets

16,348,163

14,934,648

13,354,200

13,346,705

11,491,054

Net Assets Backing

16,152,263

14,618,948

12,899,766

12,894,907

11,234,054

Shareholders' Funds

16,152,263

14,618,948

12,899,766

12,894,907

11,234,054

Total Share Capital

2,626,005

2,626,005

2,626,005

2,626,005

2,626,005

Total Reserves

13,526,258

11,992,943

10,273,761

10,268,902

8,608,049

LIQUIDITY (Times)

Cash Ratio

0.33

0.22

0.41

0.12

0.12

Liquid Ratio

0.95

0.90

1.10

0.64

0.67

Current Ratio

1.44

1.36

1.60

1.12

1.14

WORKING CAPITAL CONTROL (Days)

Stock Ratio

59

59

56

64

64

Debtors Ratio

68

78

64

59

68

Creditors Ratio

99

106

96

118

115

SOLVENCY RATIOS (Times)

Gearing Ratio

0.01

0.01

0.02

0.03

0

Liabilities Ratio

0.47

0.59

0.50

0.65

0.60

Times Interest Earned Ratio

295.66

230.71

102.03

354.21

0

Assets Backing Ratio

6.23

5.69

5.09

5.08

4.38

PERFORMANCE RATIO (%)

Operating Profit Margin

11.90

11.11

5.70

11.66

12.30

Net Profit Margin

9.38

8.29

3.32

10.09

10.01

Return On Net Assets

16.42

17.28

8.54

18.87

18.27

Return On Capital Employed

16.36

17.19

8.48

18.73

18.27

Return On Shareholders' Funds/Equity

13.05

13.11

5.09

16.86

15.21

Dividend Pay Out Ratio (Times)

0.27

0.10

0.99

0.24

0.47

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0



FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.66.75

UK Pound

1

Rs.99.61

Euro

1

Rs.70.67

MYR

1

Rs.15.89

 

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

 

 

INFORMATION DETAILS

 

Analysis Done by :

KIN

 

 

Report Prepared by :

TPT

 


               

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.