MIRA INFORM REPORT

 

 

Report No. :

357008

Report Date :

31.12.2015

 

IDENTIFICATION DETAILS

 

Name :

ACCORD COMMODITIES SDN. BHD.

 

 

Registered Office :

Suite 12b-23, Wisma Zelan, 1, Jalan Tasik Permaisuri 2, Bandar Tun Razak, Cheras, Level 12b, 56000 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2014

 

 

Date of Incorporation :

21.09.2000

 

 

Com. Reg. No.:

526800-W

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Trading in palm oil products.

 

 

No. of Employee :

10 [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.

:

526800-W

COMPANY NAME

:

ACCORD COMMODITIES SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

21/09/2000

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

SUITE 12B-23, WISMA ZELAN, 1, JALAN TASIK PERMAISURI 2, BANDAR TUN RAZAK, CHERAS, LEVEL 12B, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

SUITE 09-15, WISMA ZELAN, 1, JALAN TASIK PERMAISURI 2, BANDAR TUN RAZAK, CHERAS, 9TH. FLOOR, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

:

03-91723881

FAX.NO.

:

03-91723882

CONTACT PERSON

:

SIRAJ SABUWALA ( MANAGING DIRECTOR )

INDUSTRY CODE

:

46202

PRINCIPAL ACTIVITY

:

TRADING IN PALM OIL 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 1,500,000.00 DIVIDED INTO
ORDINARY SHARES 500,000 CASH AND 1,000,000 OTHERWISE OF MYR 1.00 EACH.

SALES

:

MYR 58,306,472 [2014]

NET WORTH

:

MYR 3,349,686 [2014]

STAFF STRENGTH

:

10 [2015]

BANKER (S)

:

MALAYAN BANKING 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

:

MATURE

 

 

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 in palm oil products.

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

 

Former Address(es)

Address

As At Date

SUITE 12B-23, WISMA ZELAN, 1, JALAN TASIK PERMAISURI 2, BANDAR TUN RAZAK, CHERAS, 14TH FLOOR, 56000, WILAYAH PERSEKUTUAN, MALAYSIA

12/09/2007

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

10/04/2015

MYR 5,000,000.00

MYR 1,500,000.00

10/07/2007

MYR 1,000,000.00

MYR 1,000,000.00

02/12/2004

MYR 500,000.00

MYR 500,000.00

01/07/2003

MYR 500,000.00

MYR 350,000.00

31/10/2000

MYR 500,000.00

MYR 200,000.00

30/09/2000

MYR 500,000.00

MYR 2.00

 

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


Current Shareholder(s) :

Name

Address

IC/PP/Loc No

Shareholding

(%)

MR. SIRAJ SABUWALA +

B-21-02, KIARAMAS SUTERA CONDOMINIUM, 7, JALAN DESA KIARA, BUKIT KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Z1799357

735,000.00

49.00

MS. HONG FOOI YONG +

36, JALAN DAMAI PERDANA 16/1B, BANDAR DAMAI PERDANA, CHERAS, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

791107-14-5378

541,500.00

36.10

MR. FEROZ KHAN BIN GULAM HUSSAIN

9, JALAN SS 3/13, 47300 PETALING JAYA, SELANGOR, MALAYSIA.

401003-10-5527 3908581

223,500.00

14.90

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

------

1,500,000.00

100.00

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

=====

+ Also Director


Former Shareholder(s) :

Name

Country

IC/PP/Loc No

Shareholding

Last Updated

FARID FAZAL SABUWALA

MALAYSIA

B0438611

N/A

N/A

FAZAL ALAUDIN SABUWALA

N/A

B3279161

N/A

20/10/2005

JUNAINAH BINTI ABDUL KARIM

MALAYSIA

760907-11-5386

N/A

N/A



DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MS. HONG FOOI YONG

Address

:

36, JALAN DAMAI PERDANA 16/1B, BANDAR DAMAI PERDANA, CHERAS, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Other Address(es)

:

JALAN PEEL, PUDU ULU, 43200 CHERAS, SELANGOR, MALAYSIA.

New IC No

:

791107-14-5378

Date of Birth

:

07/11/1979

Nationality

:

MALAYSIAN

Date of Appointment

:

01/09/2012

 

DIRECTOR 2

 

Name Of Subject

:

MR. SIRAJ SABUWALA

Address

:

B-21-02, KIARAMAS SUTERA CONDOMINIUM, 7, JALAN DESA KIARA, BUKIT KIARA, 50480 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

Z1799357

Nationality

:

INDIAN

Date of Appointment

:

16/06/2003



MANAGEMENT

 

 

 

1)

Name of Subject

:

SIRAJ SABUWALA

Position

:

MANAGING DIRECTOR

 

 

 

AUDITOR

 

Auditor

:

S P TAN & SUNDAR

Auditor' Address

:

SUITE 12B-22, WISMA ZELAN, 1, JALAN TASIK PERMAISURI 2, BANDAR TUN RAZAK, CHERAS, LEVEL 12B, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. T RATNAJOTHY A/P THAMBIDURAI

IC / PP No

:

5479627

New IC No

:

580606-08-5146

Address

:

LOT 587/72, JALAN NGP 2/4, NEW GREEN PARK, JALAN WATERFALL, 48000 RAWANG, SELANGOR, MALAYSIA.

 

2)

Company Secretary

:

MR. SURDASS @ VIPIN KUMAR

IC / PP No

:

4243746

New IC No

:

511114-10-5957

Address

:

11, LORONG RAHIM KAJAI 8, TAMAN TUN DR. ISMAIL, 60000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING BHD

 

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

25/11/2005

N/A

MALAYAN BANKING BERHAD

MYR 800,000.00

Satisfied

2

07/06/2007

N/A

MALAYAN BANKING BERHAD

-

Satisfied

3

09/12/2009

MEMORANDUM OF DEPOSIT

MALAYAN BANKING BERHAD

-

Satisfied

4

12/11/2012

LETTER OF SET-OFF

RHB BANK BERHAD

-

Unsatisfied

5

26/02/2014

MEMORANDUM OF DEPOSIT & LETTER OF SET-OFF

ALLIANCE BANK MALAYSIA BERHAD

-

Unsatisfied

6

05/06/2014

MEMORANDUM OF DEPOSIT & LETTER OF SET-OFF

CITIBANK BERHAD

-

Unsatisfied

7

01/07/2015

CASH DEPOSIT AGREEMENT

OCBC BANK (MALAYSIA) BERHAD

-

Unsatisfied

8

15/07/2015

MEMORANDUM OF CHARGE OF MONEY DEPOSIT

ALLIANCE BANK MALAYSIA BERHAD

-

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

Overseas

:

YES



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

OVERALL PAYMENT HABIT

Prompt 0-30 Days

[

]

Good 31-60 Days

[

X

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

SOUTH AFRICA

MAURITIUS

MIDDLE EAST

SOUTH AMERICA

AFRICA

AUSTRALIA

INDIA

SAUDI ARABIA

EUROPE

UNITED ARAB EMIRATES

ASIA

Credit Term

:

30 - 60 DAYS

Payment Mode

:

CHEQUES
LETTER OF CREDIT (LC)
TELEGRAPHIC TRANSFER (TT)

 

 

OPERATIONS

 

Goods Traded

:

BEAUTY SOAP, REFINED EDIBLE OIL

Product Brand Name

:

ESME, VITAL

Member(s) / Affiliate(s)

:

MALAYSIA EXTERNAL TRADE DEVELOPMENT CORPORATION (MATRADE)

Ownership of premises

:

LEASED/RENTED

 

Total Number of Employees:

 

YEAR

2015

2012

2010

GROUP

N/A

N/A

N/A

COMPANY

10

10

10

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) trading in palm oil products.

The Subject offers a wide range of products which include:-

1) Palm Oil products - RBD palm oil, RBD palm stearin, palm olein, in packaged form.

2) Palm Oil by-products - Palm acid oil, crude palm kernel oil, palm fatty acid distillate (PFAD), palm kernel fatty acid distillate (PKFAD), in drums and flexi-bags.

3) Oleo-Chemicals - Soap noodles, glycerine, lauric acid, myristic acid, refined glycerine and stearic acid.

The products are mainly used by soap's, detergents and cosmetics industries.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-91723881

Match

:

N/A

Address Provided by Client

:

SUITE NO 09-154 9TH FLOOR, WISMA ZELAN NO 1 JALAN TASIK PERMAISURI 2, BANDAR TUN RAZAK , CHERAS, 56000 KUALA LUMPUR

Current Address

:

SUITE 09-15, WISMA ZELAN, 1, JALAN TASIK PERMAISURI 2, BANDAR TUN RAZAK, CHERAS, 9TH. FLOOR, 56000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Match

:

NO

Latest Financial Accounts

:

YES

 

Other Investigations


On 28th December 2015 we contacted one of the staff from the Subject and he provided some information.

The address is as per stated in the report.


 

FINANCIAL ANALYSIS

 

 

Profitability

Turnover

:

Erratic

[

2010 - 2014

]

Profit/(Loss) Before Tax

:

Increased

[

2010 - 2014

]

Return on Shareholder Funds

:

Acceptable

[

14.89%

]

Return on Net Assets

:

Acceptable

[

23.14%

]

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

:

Favourable

[

4 Days

]

Debtor Ratio

:

Favourable

[

30 Days

]

Creditors Ratio

:

Favourable

[

2 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

:

Favourable

[

1.63 Times

]

Current Ratio

:

Unfavourable

[

1.78 Times

]

A minimum liquid ratio of 1 should be maintained by the Subject in order to assure its creditors of its ability to meet short term obligations and the Subject was in a good liquidity position. Thus, we believe the Subject is able to meet all its short term obligations as and when they fall due.

Solvency

Interest Cover

:

Acceptable

[

4.63 Times

]

Gearing Ratio

:

Acceptable

[

0.91 Times

]

The Subject's interest cover was slightly low. If there is no sharp fall in its profit or sudden increase in the interest rates, we believe the Subject is able to generate sufficient income to service its interest and repay the loans. The Subject's gearing was slightly high. The Subject is utilising the leverage concept to fund its expansion. However, the high gearing has added financial risks to the Subject. It will be more vulnerable in times of economy downturn.

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 was in good liquidity position with its total current liabilities well covered by its total current assets. With its current net assets, the Subject should be able to repay its short term obligations. The Subject had an acceptable interest cover. If there is no sudden sharp increase in interest rate or fall in the Subject's profit, we do believe the Subject is able to generate sufficient cash flow to service its interest payment. The Subject's gearing was slightly high and its financial risk was also high. If no plans are made to reduce its gearing, the Subject's performance may deteriorate in the coming year.

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

30.0

30.5

Gross Domestic Products ( % )

5.1

5.6

5.3

6.0

4.7

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

82,480

85,258

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

3.2

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

49,203

-

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

44.0

44.2

Tourist Arrival ( Million Persons )

24.7

25.0

25.7

27.4

29.4

Hotel Occupancy Rate ( % )

60.6

62.4

62.6

63.6

58.8

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)

1.0

0.7

0.7

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

5.3

Electrical & Electronics

(4.0)

12.7

6.9

13.3

7.9

Rubber Products

20.7

3.0

11.7

(0.3)

3.4

Wood Products

(5.1)

8.7

(2.7)

5.1

7.1

Textiles & Apparel

13.2

(7.1)

(2.6)

11.5

7.2

Domestic-oriented Industries

10.7

1.7

6.8

9.4

3.3

Food, Beverages & Tobacco

4.80

2.70

3.60

6.13

8.90

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

3.6

Non-metallic Mineral

12.1

2.9

(2.0)

5.4

7.2

Transport Equipment

12.0

3.4

13.8

22.9

7.6

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

46202 : Wholesale of palm oil

INDUSTRY :

PALM OIL

According to the Malaysian Palm Oil Council (MPOC), Malaysia currently accounts for 39% of world palm oil production and 44% of world exports in year 2014. Malaysia is also one of the biggest producers and exporters of oil palm and palm oil products. In the last 5 years until year 2014, Malaysia earned between RM50 billion and RM70 billion a year from palm oil exports.

Besides, the ongoing implementation of Entry Point Projects (EPPs) under the National Key Economic Area (NKEA) on palm oil to enhance productivity of upstream and downstream activities will further boost the palm oil sector. Thus, palm oil sector is expected to grow 6.7% in 2014 (2013: 2.6%). Moreover, the total oil palm planted areas increased 2.8% to 5.3 million hectares as at end-June 2014 (end-June 2013: 5.2 million hectares) following the opening of 30,544 hectares of cultivated areas mainly in Sabah and Sarawak. Other than that, the production of palm oil is expected to growth by 1.6% (19.52 million tonnes) in year 2014, compared to 19.22 million tonnes in year 2013.

According to Kenanga Research, the estimated average crude palm oil (CPO) price for 2014 and 2015 is between RM2,100 and RM2,500 per tonne due to lower inventory estimate by end-2015. The estimated prices also lifted by factors such as biofuel demand and petroleum price level. But, the average price of crude palm oil (CPO) strengthened to RM2,542 per tonne during the first eight months of 2014 (January - August 2013: Rm2,309 per tonne). However, with production rising in the second quarter coupled with high inventory level (end-August 2014: 2.1 million tonnes), the price of CPO moderated to RM2,162 per tonne as at end-August 2014, and hitting a five-year low of RM1,914 per tonne in Sept 2014 as stockpiles surged to a more than 1 year high above 2 million tonnes. The moderation in CPO prices was also due to a surge in global supplies of edible oil, particularly the bumper harvest of soybean in the US.

Over the total exports of major products in year 2013, palm oil accounts 6.4% of share in the total exports. During the first seven months of 2014, export receipts of palm oil rebounded by 4.9% to RM25.8 billion (January - July 2013: -21.9%, RM 24.6 billion) due to higher export prices averaging RM 2,703 per tonne (January - July 2013: Rm 2,456 per tonne). As a measure to reduce the high inventory due to strong output, the Government has exempted export tax on CPO until December 2014. The Government's move to extend the export duty exemption for crude palm oil (CPO) has received positive reaction from industry players. The chairman of Malaysian Palm Oil Board (MPOB) said the move provided a stable effect on the CPO market prices.

In Budget 2015, there is an allocation of RM41 million for smallholders to plant and replant oil palm. The incentives for commodities announced in Budget 2015 will help alleviate the problems faced by the industry, especially the poor prices for rubber and palm oil.

According to the Minister of Plantation Industries and Commodities, the Malaysian government will increase the amount of palm oil based bio-diesel in the national diesel supply mix from November 2014, in a move that will also help to increase consumption of crude palm oil (CPO) and reduce stockpile levels of the commodity. The implementation of the B7 blend will also increase the use palm oil which prices have softened due to oversupply in the market. According to the Malaysian Palm Oil Council (MPOC), CPO prices are expected to improve to between RM2,100 and RM2,500 in year 2015, lifted by factors such as biofuel demand from the B7 programme. CIMB Research estimates that the rollout could raise the country's palm oil demand by 263,000-390,000 tonnes per annum, or 1-2% of the total palm oil production in 2013.

OVERALL INDUSTRY OUTLOOK : Mature



CREDIT RISK EVALUATION & RECOMMENDATION

 


Incorporated in 2000, the Subject is a Private Limited company, focusing on trading in palm oil 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. A paid up capital of MYR 1,500,000 allows the Subject to expand its business more comfortably. We considered that the Subject's business position in the market is much dependent on the efforts of its directors.

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. 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.

We noted that both the turnover and profits have increased compared to the previous year. The higher profit could be due to increase in turnover and better control over its operating costs. 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 is in good liquidity position with its current liabilities well covered by it current assets. Hence, it has sufficient working capital to meet its short term financial obligations. The gearing level of the Subject is slightly high, therefore it faces moderate financial risk. Given a positive net worth standing at MYR 3,349,686, 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 has reached its optimum level and is generally stable. It is saturated and very competitive. Thus, the Subject's growth prospect is very much depends on its capacity in sustaining its performance in the market.

Based on the above condition, we recommend credit be granted to the Subject normally.

 



PROFIT AND LOSS ACCOUNT

 

 

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

 

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

GROUP

Audited Account

YES

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

YES

Financial Type

FULL

FULL

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

MYR

TURNOVER

58,306,472

41,656,617

47,939,311

63,312,321

38,306,112

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

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

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

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

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

Total Turnover

58,306,472

41,656,617

47,939,311

63,312,321

38,306,112

Costs of Goods Sold

(52,679,633)

(37,555,071)

(44,472,747)

(37,438,665)

-

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

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

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

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

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

Gross Profit

5,626,839

4,101,546

3,466,564

25,873,656

-

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

615,336

607,915

354,942

988,656

361,518

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

615,336

607,915

354,942

988,656

361,518

Taxation

(116,606)

(86,622)

(79,215)

(123,705)

(55,305)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

498,730

521,293

275,727

864,951

306,213

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

1,350,956

1,579,663

1,303,936

337,564

31,351

Prior year adjustment

-

-

-

101,421

-

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

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

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

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

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

As restated

1,350,956

1,579,663

1,303,936

438,985

31,351

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

1,849,686

2,100,956

1,579,663

1,303,936

337,564

DIVIDENDS - Ordinary (paid & proposed)

-

(750,000)

-

-

-

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

1,849,686

1,350,956

1,579,663

1,303,936

337,564

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Hire purchase

3,129

5,459

3,523

5,490

5,740

Term loan / Borrowing

160,438

143,221

101,020

86,284

-

Others

5,753

16,933

22,550

20,957

95,474

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

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

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

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

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

169,320

165,613

127,093

112,731

101,214

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

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

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

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

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

DEPRECIATION (as per notes to P&L)

76,138

75,150

54,388

47,141

227,066

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

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

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

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

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

76,138

75,150

54,388

47,141

227,066

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

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

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

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

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

 

 

 

BALANCE SHEET

 

 

 

ASSETS EMPLOYED:

FIXED ASSETS

182,504

198,072

143,602

137,195

1,097,584

LONG TERM INVESTMENTS/OTHER ASSETS

Subsidiary companies

-

-

-

500,000

-

Investments

-

-

490,000

-

-

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

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

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

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

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

TOTAL LONG TERM INVESTMENTS/OTHER ASSETS

-

-

490,000

500,000

-

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

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

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

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

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

TOTAL LONG TERM ASSETS

182,504

198,072

633,602

637,195

1,097,584

Stocks

626,670

98,877

418,241

107,618

1,456,833

Trade debtors

4,857,599

3,798,296

2,514,504

1,673,735

4,750,625

Other debtors, deposits & prepayments

316,382

174,427

2,356,126

2,449,985

476,989

Short term deposits

919,454

1,669,427

1,560,895

1,117,440

1,177,695

Amount due from subsidiary companies

-

-

-

685,642

-

Amount due from director

-

-

14,662

1,986

7,225

Cash & bank balances

591,720

666,383

273,654

83,490

416,060

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

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

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

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

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

TOTAL CURRENT ASSETS

7,311,825

6,407,410

7,138,082

6,119,896

8,285,427

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

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

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

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

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

TOTAL ASSET

7,494,329

6,605,482

7,771,684

6,757,091

9,383,011

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

316,948

1,173,335

555,523

554,971

1,556,549

Other creditors & accruals

690,634

234,224

253,138

196,608

1,163,471

Hire purchase & lease creditors

38,156

46,565

39,639

37,672

-

Short term borrowings/Term loans

400,000

400,000

400,000

300,000

200,000

Bill & acceptances payable

2,610,000

1,828,000

3,394,000

2,746,000

4,485,827

Amounts owing to director

-

-

-

-

12,966

Provision for taxation

48,278

7,702

32,814

63,792

13,043

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

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

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

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

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

TOTAL CURRENT LIABILITIES

4,104,016

3,689,826

4,675,114

3,899,043

7,431,856

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

3,207,809

2,717,584

2,462,968

2,220,853

853,571

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

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

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

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

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

TOTAL NET ASSETS

3,390,313

2,915,656

3,096,570

2,858,048

1,951,155

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

1,500,000

1,500,000

1,500,000

1,500,000

1,500,000

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

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

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

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

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

TOTAL SHARE CAPITAL

1,500,000

1,500,000

1,500,000

1,500,000

1,500,000

Retained profit/(loss) carried forward

1,849,686

1,350,956

1,579,663

1,303,936

337,564

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

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

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

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

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

TOTAL RESERVES

1,849,686

1,350,956

1,579,663

1,303,936

337,564

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

3,349,686

2,850,956

3,079,663

2,803,936

1,837,564

Other long term borrowings

-

-

-

-

110,231

Hire purchase creditors

6,523

44,680

10,193

49,832

-

Deferred taxation

34,104

20,020

6,714

4,280

3,360

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

40,627

64,700

16,907

54,112

113,591

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

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

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

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

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

3,390,313

2,915,656

3,096,570

2,858,048

1,951,155

 

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

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

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

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

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

 

 

 

 

FINANCIAL RATIO

 

 

 

TYPES OF FUNDS

Cash

1,511,174

2,335,810

1,834,549

1,200,930

1,593,755

Net Liquid Funds

(1,098,826)

507,810

(1,559,451)

(1,545,070)

(2,892,072)

Net Liquid Assets

2,581,139

2,618,707

2,044,727

2,113,235

(603,262)

Net Current Assets/(Liabilities)

3,207,809

2,717,584

2,462,968

2,220,853

853,571

Net Tangible Assets

3,390,313

2,915,656

3,096,570

2,858,048

1,951,155

Net Monetary Assets

2,540,512

2,554,007

2,027,820

2,059,123

(716,853)

PROFIT & LOSS ITEMS

Earnings Before Interest & Tax (EBIT)

784,656

773,528

482,035

1,101,387

462,732

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

860,794

848,678

536,423

1,148,528

689,798

BALANCE SHEET ITEMS

Total Borrowings

3,054,679

2,319,245

3,843,832

3,133,504

4,796,058

Total Liabilities

4,144,643

3,754,526

4,692,021

3,953,155

7,545,447

Total Assets

7,494,329

6,605,482

7,771,684

6,757,091

9,383,011

Net Assets

3,390,313

2,915,656

3,096,570

2,858,048

1,951,155

Net Assets Backing

3,349,686

2,850,956

3,079,663

2,803,936

1,837,564

Shareholders' Funds

3,349,686

2,850,956

3,079,663

2,803,936

1,837,564

Total Share Capital

1,500,000

1,500,000

1,500,000

1,500,000

1,500,000

Total Reserves

1,849,686

1,350,956

1,579,663

1,303,936

337,564

LIQUIDITY (Times)

Cash Ratio

0.37

0.63

0.39

0.31

0.21

Liquid Ratio

1.63

1.71

1.44

1.54

0.92

Current Ratio

1.78

1.74

1.53

1.57

1.11

WORKING CAPITAL CONTROL (Days)

Stock Ratio

4

1

3

1

14

Debtors Ratio

30

33

19

10

45

Creditors Ratio

2

11

5

5

15

SOLVENCY RATIOS (Times)

Gearing Ratio

0.91

0.81

1.25

1.12

2.61

Liabilities Ratio

1.24

1.32

1.52

1.41

4.11

Times Interest Earned Ratio

4.63

4.67

3.79

9.77

4.57

Assets Backing Ratio

2.26

1.94

2.06

1.91

1.30

PERFORMANCE RATIO (%)

Operating Profit Margin

1.06

1.46

0.74

1.56

0.94

Net Profit Margin

0.86

1.25

0.58

1.37

0.80

Return On Net Assets

23.14

26.53

15.57

38.54

23.72

Return On Capital Employed

22.89

26.11

15.37

38.03

23.72

Return On Shareholders' Funds/Equity

14.89

18.28

8.95

30.85

16.66

Dividend Pay Out Ratio (Times)

0

1.44

0

0

0

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0

 

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.66.42

UK Pound

1

Rs.98.55

Euro

1

Rs.72.60

MYR

1

Rs.15.39

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

 

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

Report Prepared by :

ANK

 


 

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.