MIRA INFORM REPORT

 

 

Report No. :

306669

Report Date :

09.02.2015

 

IDENTIFICATION DETAILS

 

Name :

ESM PRECISE MANUFACTURING SDN. BHD.

 

 

Registered Office :

12a-3, Jalan Pju 8/5c, Perdana Business Centre, Bandar Damansara Perdana, 47820 Petaling Jaya, Selangor

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2013

 

 

Date of Incorporation :

03.03.2011

 

 

Com. Reg. No.:

934832-U

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Fabrication of plastic injection molding machines

 

 

No. of Employee :

25 [2015]

 

 

RATING & COMMENTS

 

MIRA’s Rating :

Ca

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Moderate

 

 

Payment Behaviour :

Slow

 

 

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 – December 31, 2014

 

Country Name

Previous Rating

(30.09.2014)

Current Rating

(31.12.2014)

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. The NAJIB administration also is continuing efforts to boost domestic demand and reduce the economy's dependence on exports. Nevertheless, exports - particularly of electronics, oil and gas, palm oil and rubber - remain a significant driver of the economy. As an oil and gas exporter, Malaysia has profited from higher world energy prices, although the rising cost of domestic gasoline and diesel fuel, combined with sustained budget deficits, has forced Kuala Lumpur to begin to address fiscal shortfalls, through initial reductions in energy and sugar subsidies and the announcement of the 2015 implementation of a 6% goods and services tax. The government is also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplies about 32% of government revenue in 2013. Bank Negara Malaysia (central bank) maintains healthy foreign exchange reserves, and a well-developed regulatory regime has limited Malaysia's exposure to riskier financial instruments and the global financial crisis. Nevertheless, Malaysia could be vulnerable to a fall in commodity prices or a general slowdown in global economic activity because exports are a major component of GDP. In order to attract increased investment, NAJIB earlier raised possible revisions to the special economic and social preferences accorded to ethnic Malays under the New Economic Policy of 1970, but retreated in 2013 after he encountered significant opposition from Malay nationalists and other vested interests. In September 2013 NAJIB launched the new Bumiputra Economic Empowerment Program (BEEP), policies that favor and advance the economic condition of ethnic Malays.

 

Source : CIA

 

 

 

 

 

EXECUTIVE SUMMARY

 

 

REGISTRATION NO.

:

934832-U

COMPANY NAME

:

ESM PRECISE MANUFACTURING SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

03/03/2011

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

12A-3, JALAN PJU 8/5C, PERDANA BUSINESS CENTRE, BANDAR DAMANSARA PERDANA, 47820 PETALING JAYA, SELANGOR, MALAYSIA.

BUSINESS ADDRESS

:

26, SERULING 58,TAMAN KLANG JAYA,, 41200 KLANG, SELANGOR, MALAYSIA.

TEL.NO.

:

03-33262900

FAX.NO.

:

03-33262901

EMAIL

:

SALES1@ESMACHINERY.COM.MY

WEB SITE

:

WWW.ESMACHINERY.COM.MY

CONTACT PERSON

:

POH CHOON HOCK ( DIRECTOR )

 

 

 

INDUSTRY CODE

:

28

PRINCIPAL ACTIVITY

:

FABRICATION OF PLASTIC INJECTION MOLDING MACHINES

AUTHORISED CAPITAL

:

MYR 500,000.00 DIVIDED INTO
ORDINARY SHARE 500,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 500,000.00 DIVIDED INTO
ORDINARY SHARES 500,000 CASH OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 3,405,544 [2013]

NET WORTH

:

MYR (547,510) [2013]

 

 

 

STAFF STRENGTH

:

25 [2015]

BANKER (S)

:

UNITED OVERSEAS BANK (MALAYSIA) BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

POOR

PAYMENT

:

FAIR

MANAGEMENT CAPABILITY

:

WEAK

 

 

 

COMMERCIAL RISK

:

MODERATE

CURRENCY EXPOSURE

:

MODERATE

GENERAL REPUTATION

:

SATISFACTORY

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

PROPOSED CREDIT LIMIT

:

NIL

 

 

 

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) fabrication of plastic injection molding machines.

 

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

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

30/06/2014

MYR 500,000.00

MYR 500,000.00

03/03/2011

MYR 100,000.00

MYR 100.00

 

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

Name

Address

IC/PP/Loc No

Shareholding

(%)

MR. POH CHOON HOCK +

1-16-07, LOT 6, JALAN PJU 8/3, PERDANA EMERALD CONDOMINIUM, DAMANSARA PERDANA, 47820 PETALING JAYA, SELANGOR, MALAYSIA.

530331-02-5287 4431532

250,000.00

50.00

MS. MA AH YONG +

1-16-07, LOT 6, JALAN PJU 8/3, PERDANA EMERALD CONDOMINIUM, DAMANSARA PERDANA, 47820 PETALING JAYA, SELANGOR, MALAYSIA.

570308-02-5832 5253105

250,000.00

50.00

 

 

 

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

------

 

 

 

500,000.00

100.00

 

 

 

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

=====

+ Also Director

 

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. POH CHOON HOCK

Address

:

1-16-07, LOT 6, JALAN PJU 8/3, PERDANA EMERALD CONDOMINIUM, DAMANSARA PERDANA, 47820 PETALING JAYA, SELANGOR, MALAYSIA.

IC / PP No

:

4431532

New IC No

:

530331-02-5287

Date of Birth

:

31/03/1953

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

03/03/2011

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MS. MA AH YONG

Address

:

1-16-07, LOT 6, JALAN PJU 8/3, PERDANA EMERALD CONDOMINIUM, DAMANSARA PERDANA, 47820 PETALING JAYA, SELANGOR, MALAYSIA.

IC / PP No

:

5253105

New IC No

:

570308-02-5832

Date of Birth

:

08/03/1957

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

03/03/2011

 

 

 

 

 

 

 

 

 

MANAGEMENT

 

 

 

1)

Name of Subject

:

POH CHOON HOCK

 

Position

:

DIRECTOR

 

 

 

 

 

 

 

AUDITOR

 

Auditor

:

Y L CHEE & CO.

Auditor' Address

:

12A-2, JALAN PJU 8/5C, PERDANA BUSINESS CENTRE, BANDAR DAMANSARA PERDANA, 47820 PETALING JAYA, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. CHEE WAI YEN

 

IC / PP No

:

5650914

 

New IC No

:

590205-08-5646

 

Address

:

M4-1-6, FAWINA COURT CONDOMINIUM, JALAN HILIR, TAMAN AMPANG HILIR, 68000 AMPANG, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

2)

Company Secretary

:

MS. CHEE SOCK KION

 

IC / PP No

:

A1423086

 

New IC No

:

690905-01-5460

 

Address

:

23, JALAN ARA SD 7/3C, BANDAR SRI DAMANSARA, 52200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

UNITED OVERSEAS BANK (MALAYSIA) BHD

 

 

 

 

 

 

 

 

 

 

 

 

ENCUMBRANCE (S)


No encumbrance was found in our databank at the time of investigation.

 

 

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

Import Countries

:

CHINA



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

OVERALL PAYMENT HABIT

Prompt 0-30 Days

[

 

]

 

Good 31-60 Days

[

 

]

 

Average 61-90 Days

[

 

]

 

Fair 91-120 Days

[

X

]

 

Poor >120 Days

[

 

]

 

 

 

 

 

 

 

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

 

 

 

Export Market

:

THAILAND

INDONESIA

VIETNAM

PHILIPPINES

SRI LANKA

INDIA

Credit Term

:

30 - 60 DAYS

 

 

 

 

 

 

Payment Mode

:

LETTER OF CREDIT (LC)
CASH
CHEQUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Products manufactured

:

PLASTIC INJECTION MOLDING MACHINES

 

 

 

Competitor(s)

:

ASIAN GRINDING TECHNOLOGY SDN BHD
CHECKPOINT SYSTEMS (M) SDN BHD
LEAP VENTURE (M) SDN BHD
SENJU (MALAYSIA) SDN BHD
WB COATINGS ASIA SDN BHD

 

 

 

 

 

 

 

 

 

Total Number of Employees:

 

YEAR

2015

2014

2012

 

 

 

 

 

 

GROUP

N/A

N/A

N/A

 

 

 

 

 

 

COMPANY

25

50

50

 

 

 

 

 

 

 

Branch

:

NO

 

 

Other Information:


The Subject is principally engaged in the (as a / as an) fabrication of plastic injection molding machines.

The Subject fabricates high performance and high precise plastic injection molding machines.

The Subject also provides maintenance services for the machines.


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

N/A

Current Telephone Number

:

03-33262900

Match

:

N/A

 

 

 

Address Provided by Client

:

26, SERULING 58,TAMAN KLANG JAYA,,41200,KLANG,SELANGOR.

Current Address

:

26, SERULING 58,TAMAN KLANG JAYA,, 41200 KLANG, SELANGOR, MALAYSIA.

Match

:

YES

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


On 5th February 2015 we contacted one of the staff from the Subject and she provided some information.

 


FINANCIAL ANALYSIS

 

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2011 - 2013

]

 

Profit/(Loss) Before Tax

:

Increased

[

2011 - 2013

]

 

Return on Shareholder Funds

:

Unfavourable

[

126.59%

]

 

Return on Net Assets

:

Unfavourable

[

126.59%

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.Higher losses before tax during the year could be due to the higher operating costs incurred. Although the Subject's returns showed positive figures it is not reflective of the true situation. The Subject incurred losses during the year and its shareholders' funds have turned red. The positive returns on shareholders' funds is the result of losses divided by negative shareholders' funds. The Subject's management was inefficient in utilising the assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Nil

[

0 Days

]

 

Debtor Ratio

:

Favourable

[

42 Days

]

 

Creditors Ratio

:

Unfavourable

[

86 Days

]

 

 

 

 

 

 

 

 

As the Subject is a service oriented company, the Subject does not need to keep stocks. The favourable debtors' days could be due to the good credit control measures implemented by the Subject. 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

:

Unfavourable

[

0.54 Times

]

 

Current Ratio

:

Unfavourable

[

0.54 Times

]

 

 

 

 

 

 

 

 

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

 

 

 

 

 

 

 

Solvency

 

 

 

 

 

 

Interest Cover

:

Nil

[

0.00 Times

]

 

Gearing Ratio

:

Favourable

[

0.00 Times

]

 

 

 

 

 

 

 

 

The Subject's interest cover was nil as it did not pay any interest during the year. 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 :

 

 

 

 

 

 

The Subject's losses increased but its turnover showed a  fluctuating trend. This indicate the Subject was slowly losing its market share due to its competitors. Due to its weak liquidity position, the Subject will be faced with problems in meeting all its short term obligations if no short term loan is obtained or additional capital injected into the Subject. The Subject did not make any interest payment during the year. The Subject was dependent on its shareholders' funds to finance its business needs. The Subject was a zero gearing company, it was solely dependant on its shareholders to provide funds to finance its business. The Subject has good chance of getting loans, if the needs arises.

 

 

 

 

 

 

 

Overall financial condition of the Subject : POOR

 

 

 

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

3.3

4.0

Unemployment Rate

3.3

3.2

3.0

3.0

3.0

 

 

 

 

 

 

Net International Reserves ( MYR Billion )

415

427

-

417

-

Average Risk-Weighted Capital Adequacy Ratio ( % )

3.50

2.20

-

-

-

Average 3 Months of Non-performing Loans ( % )

14.80

14.70

-

-

-

Average Base Lending Rate ( % )

6.60

6.53

6.53

-

-

Business Loans Disbursed( % )

15.3

32.2

-

-

-

Foreign Investment ( MYR Million )

23,546.1

26,230.4

38,238.0

-

-

Consumer Loans ( % )

-

-

-

-

-

 

 

 

 

 

 

Registration of New Companies ( No. )

45,455

45,441

46,321

-

-

Registration of New Companies ( % )

3.0

(0.0)

1.9

-

-

Liquidation of Companies ( No. )

132,485

17,092

26,430

-

-

Liquidation of Companies ( % )

417.8

(87.1)

54.6

-

-

 

 

 

 

 

 

Registration of New Business ( No. )

284,598

324,761

329,895

-

-

Registration of New Business ( % )

5.0

14.0

2.0

-

-

Business Dissolved ( No. )

20,121

20,380

18,161

-

-

Business Dissolved ( % )

1.9

1.3

(10.9)

-

-

 

 

 

 

 

 

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

-

-

 

 

 

 

 

 

Credit Cards Spending ( % )

15.6

12.6

-

-

-

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)

-

-

-

-

Other Mining

-

-

-

-

-

Industry Non-performing Loans ( MYR Million )

46.5

-

-

-

-

% of Industry Non-performing Loans

0.1

-

-

-

-

 

 

 

 

 

 

Manufacturing #

4.7

4.8

3.4

6.6

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

-

-

Plastic Products

3.8

-

-

-

-

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

-

-

-

-

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

28 : MANUFACTURE OF MACHINERY AND EQUIPMENT N.E.C

 

 

INDUSTRY :

MACHINERY

 

 

 

Malaysia is presently the leading manufacturer of automation machinery and equipment (M&E) in the ASEAN region with a total of 22 companies in production. The machinery and equipment industry has expanded and produce a diverse range of machinery which give importance to the overall industrial development of the country, due to its cross cutting linkages with all industrial sectors.

 

Growth of the domestic-oriented industries such as machinery and transportation equipment is expected to remain favourable in 2014, in line with resilient domestic consumption and robust private investment. However, the output of general-purpose machinery decreased 8.8% in the first seven moths of 2014 (January - July 2013: -1.8%) due to the decline in manufacture of air-conditioning machine (-17.9%) as well as lifting and handling equipment (-8.2%).

 

Besides, shipments of machinery, appliances and parts continued to expand rapidly by 12.5% in the first seven months of 2014 (January - July 2013: 1.4%) with stronger demand from Singapore, the US, China and Australia. Growth was mainly contributed by specialized machinery for specific industries (16.3%), particularly for civil engineering and manufacture of semiconductors as well as general industrial machinery and equipment (9.2%) such as heating and cooling equipment and parts as well as mechanical handling equipment and parts.

 

According to the World Bank's Doing Business 2014 Report, Malaysia improved to 15th from 25th position in the 2014 Foreign Direct Investment Confidence Index, with highlighted Malaysia's efforts in building its competitive position in electronics, automotive, and machinery manufacturing to move up the value chain into high technology and skill-intensive segments.

 

The Government has identified the M&E industry to be one of the key areas for growth and development. The growth will focus on the manufacture of high value-added and high technology M&E. For the further development of the M&E industry, six strategic thrusts have been set during the Third Industrial Master Plan (IMP3), 2006 - 2020 period:-

- Promoting Malaysia as a regional production, trading and distribution centre for M&E

- Rising the development and promotion of selected specialized and high technology M&E

- Strengthening the engineering support industries and support services

- Developing Malaysian Standards for machinery and equipment

- Developing sufficient highly skilled workforce

- Strengthening the institutional support for the further development of the industry

 

 

OVERALL INDUSTRY OUTLOOK : Average Growth

 

 

CREDIT RISK EVALUATION & RECOMMENDATION

 

 


Incorporated in 2011, the Subject is a Private Limited company, focusing on fabrication of plastic injection molding machines. The Subject has been in business for less than 5 years and it has slowly been building up contact with its clients while competing in the industry. However, it has yet to enjoy a stable market shares as it need to compete many well established players in the same field. With an issued and paid up capital of MYR 500,000 contributed by individual shareholders, the Subject may face difficulties in its attempt to further expand its business in the future. Thus, the Subject should put more efforts on its business to gain higher market share while competing aggressively in the market.

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 25 employees. Overall, we regard that the Subject's management capability is weak. Without capable management, the Subject is unlikely to be successful and often contribute to unacceptable levels of accountability. Weak management can affect productivity, profitability, sales growth and ultimately can result in the failure of a business.

Due to the challenging market conditions, the Subject's business performance seems to be deteriorating and losses incurred. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. Due to its weak liquidity position, the Subject may face working capital deficiency in meeting its short term financial obligations if no fresh capital are injected into the Subject. Being a zero geared company, the Subject virtually has no financial risk as it is mainly dependent on its internal funds to finance its business. The Subject's unfavourable financial performance over the years has wiped out its shareholders' funds to a deficit of MYR -547,510. Therefore, the Subject as a going concern is much dependent on its ability to generate sufficient cash flow and obtain additional financing to meet its future obligations.

Without a strong assets backing, the Subject may face difficulties in getting loans for its future expansion and continued growth . The Subject's supplier are from both the local and overseas countries. This will eliminates the risk of dependency on deliveries from a number of key suppliers and insufficient quantities of its raw materials. Overall the Subject has a good control over its resources.

The Subject's overall payment habit is fair and this clearly implied a weak credit control of the Subject.

The industry shows an upward trend and this trend is very likely to sustain in the near terms.

Based on the above unfavourable condition, we regard granting credit to the Subject to be quite risky. Hence, credit is not recommended.

 



PROFIT AND LOSS ACCOUNT

 

 

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

 

Financial Year End

2013-12-31

2012-12-31

2011-12-31

Months

12

12

12

Consolidated Account

Company

Company

Company

Audited Account

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

Financial Type

FULL

FULL

FULL

Currency

MYR

MYR

MYR

 

 

 

 

TURNOVER

3,405,544

10,020,458

1,662,502

 

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

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

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

Total Turnover

3,405,544

10,020,458

1,662,502

Costs of Goods Sold

(3,522,124)

(9,372,743)

(1,544,425)

 

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

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

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

Gross Profit

(116,580)

647,715

118,077

 

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

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

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

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

(693,116)

(143,241)

(211,153)

 

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

(693,116)

(143,241)

(211,153)

 

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

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

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

PROFIT/(LOSS) AFTER TAXATION

(693,116)

(143,241)

(211,153)

 

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

As previously reported

(354,394)

(211,153)

-

 

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

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

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

As restated

(354,394)

(211,153)

-

 

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

(1,047,510)

(354,394)

(211,153)

 

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

(1,047,510)

(354,394)

(211,153)

 

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

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

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

 

 

 

 

 

 

 

BALANCE SHEET

 

 

 

ASSETS EMPLOYED:

 

 

 

FIXED ASSETS

-

104,385

73,488

 

 

 

 

 

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

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

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

TOTAL LONG TERM ASSETS

-

104,385

73,488

 

 

 

 

Stocks

-

1,215,964

891,189

Trade debtors

389,667

2,436,360

490,505

Other debtors, deposits & prepayments

43,800

225,704

266,675

Cash & bank balances

203,843

173,073

23,734

 

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

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

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

TOTAL CURRENT ASSETS

637,310

4,051,101

1,672,103

 

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

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

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

TOTAL ASSET

637,310

4,155,486

1,745,591

 

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

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

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

 

 

 

 

CURRENT LIABILITIES

 

 

 

Trade creditors

831,261

3,766,113

1,110,296

Other creditors & accruals

353,559

243,767

346,448

 

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

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

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

TOTAL CURRENT LIABILITIES

1,184,820

4,009,880

1,456,744

 

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

(547,510)

41,221

215,359

 

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

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

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

TOTAL NET ASSETS

(547,510)

145,606

288,847

 

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

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

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

 

 

 

 

SHARE CAPITAL

 

 

 

Ordinary share capital

500,000

500,000

500,000

 

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

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

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

TOTAL SHARE CAPITAL

500,000

500,000

500,000

 

 

 

 

Retained profit/(loss) carried forward

(1,047,510)

(354,394)

(211,153)

 

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

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

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

TOTAL RESERVES

(1,047,510)

(354,394)

(211,153)

 

 

 

 

 

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

(547,510)

145,606

288,847

 

 

 

 

 

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

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

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

 

(547,510)

145,606

288,847

 

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

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

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

 

 

 

 

 

 

 

FINANCIAL RATIO

 

 

 

TYPES OF FUNDS

 

 

 

Cash

203,843

173,073

23,734

Net Liquid Funds

203,843

173,073

23,734

Net Liquid Assets

(547,510)

(1,174,743)

(675,830)

Net Current Assets/(Liabilities)

(547,510)

41,221

215,359

Net Tangible Assets

(547,510)

145,606

288,847

Net Monetary Assets

(547,510)

(1,174,743)

(675,830)

BALANCE SHEET ITEMS

 

 

 

Total Borrowings

0

0

0

Total Liabilities

1,184,820

4,009,880

1,456,744

Total Assets

637,310

4,155,486

1,745,591

Net Assets

(547,510)

145,606

288,847

Net Assets Backing

(547,510)

145,606

288,847

Shareholders' Funds

(547,510)

145,606

288,847

Total Share Capital

500,000

500,000

500,000

Total Reserves

(1,047,510)

(354,394)

(211,153)

LIQUIDITY (Times)

 

 

 

Cash Ratio

0.17

0.04

0.02

Liquid Ratio

0.54

0.71

0.54

Current Ratio

0.54

1.01

1.15

WORKING CAPITAL CONTROL (Days)

 

 

 

Stock Ratio

0

44

196

Debtors Ratio

42

89

108

Creditors Ratio

86

147

262

SOLVENCY RATIOS (Times)

 

 

 

Gearing Ratio

0.00

0.00

0.00

Liabilities Ratio

(2.16)

27.54

5.04

Times Interest Earned Ratio

0.00

0.00

0.00

Assets Backing Ratio

(1.10)

0.29

0.58

PERFORMANCE RATIO (%)

 

 

 

Operating Profit Margin

(20.35)

(1.43)

(12.70)

Net Profit Margin

(20.35)

(1.43)

(12.70)

Return On Net Assets

126.59

(98.38)

(73.10)

Return On Capital Employed

126.59

(98.38)

(73.10)

Return On Shareholders' Funds/Equity

126.59

(98.38)

(73.10)

Dividend Pay Out Ratio (Times)

0.00

0.00

0.00

NOTES TO ACCOUNTS

 

 

 

Contingent Liabilities

0

0

0

 

 

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.61.74

UK Pound

1

Rs.94.65

Euro

1

Rs.70.79

 

 

INFORMATION DETAILS

 

Analysis Done by :

RAS

 

 

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.