MIRA INFORM REPORT

 

 

Report No. :

343618

Report Date :

05.10.2015

 

IDENTIFICATION DETAILS

 

Name :

IFFCO (S.E.A.) SDN. BHD.

 

 

Registered Office :

Suite 1005, 10th Floor, Wisma Hamzah-Kwong Hing, 1, Leboh Ampang, 50100 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

30.06.2014

 

 

Date of Incorporation :

15.12.2000

 

 

Com. Reg. No.:

534996-V

 

 

Legal Form :

Private Limited (Limited By Share)

 

 

Line of Business :

Subject is engaged in the trading of palm oils & vegetable oil.

 

 

No. of Employees :

52 [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.

:

534996-V

COMPANY NAME

:

IFFCO (S.E.A.) SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

15/12/2000

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED (LIMITED BY SHARE)

LISTED STATUS

:

NO

REGISTERED ADDRESS

:

SUITE 1005, 10TH FLOOR, WISMA HAMZAH-KWONG HING, 1, LEBOH AMPANG, 50100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

LOT A & B, TOWER 2, ETIQA TWINS, 11, JALAN PINANG, LEVEL 22, 50450 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

:

03-21742020

FAX.NO.

:

03-21760355

WEB SITE

:

WWW.IFFCO.COM

CONTACT PERSON

:

PURNENDU RAJESHWAR THAKORE ( CEO )

INDUSTRY CODE

:

46202

PRINCIPAL ACTIVITY

:

TRADING OF PALM OILS & VEGETABLE OIL

AUTHORISED CAPITAL

:

MYR 10,000,000.00 DIVIDED INTO 
ORDINARY SHARE 10,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 10,000,000.00 DIVIDED INTO 
ORDINARY SHARES 10,000,000 CASH OF MYR 1.00 EACH.

SALES

:

MYR 1,009,447,920 [2014]

NET WORTH

:

MYR 23,251,680 [2014]

STAFF STRENGTH

:

52 [2015]

BANKER (S)

:

HSBC BANK MALAYSIA BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

STABLE

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 of palm oils & vegetable oil.

 

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

 

The immediate holding company of the Subject is IFFCO SINGAPORE PTE. LTD., a company incorporated in SINGAPORE.

 

Share Capital History

Date

Authorised Shared Capital

Issue & Paid Up Capital

20/11/2014

MYR 10,000,000.00

MYR 10,000,000.00

15/02/2013

MYR 10,000,000.00

MYR 7,000,000.00

13/06/2011

MYR 10,000,000.00

MYR 4,670,000.00

22/02/2008

MYR 500,000.00

MYR 350,000.00

26/02/2001

MYR 100,000.00

MYR 100,000.00

15/12/2000

MYR 100,000.00

MYR 2.00

 

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

 

Current Shareholder(s) :

Name

Address

IC/PP/Loc No

Shareholding

(%)

IFFCO SINGAPORE PTE. LTD.

78, SHENTON WAY, 26-02A, 079120, SINGAPORE.

200602677

10,000,000.00

100.00

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

------

10,000,000.00

100.00

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

=====

 

+ Also Director

 

Former Shareholder(s) :

Name

Country

IC/PP/Loc No

Shareholding

Last Updated

AMFIS MIDDLE EAST (FZE)

N/A

XLZ00215335

N/A

09/06/2011

AMFIS MIDDLE EAST (FZE) LIMITED LIABILITY EST.

N/A

XLZ000015436

350,000.00

26/07/2010

 

 

DIRECTORS



DIRECTOR 1

 

Name Of Subject

:

SYED RIZWAN AHMED

Address

:

VILLA NO.1, PLOT NO.14, AL FISHT AREA, SHARQ STREET, SHARJAH, UAE, UNITED ARAB EMIRATES.

IC / PP No

:

BD1158066

Nationality

:

PAKISTANI

Date of Appointment

:

02/02/2010

 

DIRECTOR 2

 

Name Of Subject

:

PURNENDU RAJESHWAR THAKORE

Address

:

12-03, TARA CONDO, 33, JALAN AMPANG HILIR, 55000 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

L3460909

Nationality

:

INDIAN

Date of Appointment

:

18/01/2010

 

DIRECTOR 3

 

Name Of Subject

:

KETAN MOTILAL DOSHI

Address

:

1802, AL SHAHD TOWER, AL QASBA, AL KHAN LAGOON, SHARJAH, U.A.E, UNITED ARAB EMIRATES.

IC / PP No

:

Z2052406

Nationality

:

INDIAN

Date of Appointment

:

13/02/2012

 

DIRECTOR 4

 

Name Of Subject

:

VISHNAMPET NATARAJAN SWAMINATHAN

Address

:

B-30-06, SUASANA SENTRAL LOFT CONDOMINIUM, JALAN STESEN SENTRAL 5, 50470 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

Z2834279

Nationality

:

INDIAN

Date of Appointment

:

13/02/2012



MANAGEMENT

 

 

1)

Name of Subject

:

PURNENDU RAJESHWAR THAKORE

Position

:

CEO

 

AUDITOR

 

Auditor

:

ATAREK KAMIL IBRAHIM & CO.

Auditor' Address

:

89-2, JALAN WANGSA DELIMA 5, PUSAT BANDAR WANGSA MAJU (KLSC), 53300 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MS. WON SWEE HWAN

IC / PP No

:

A0331878

New IC No

:

660207-10-6712

Address

:

2, JALAN LANG PERUT PUTIH 9, KEPONG BARU, 52100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

2)

Company Secretary

:

MR. JASNI BIN ABDUL JALIL

IC / PP No

:

7007140

New IC No

:

630309-07-5323

Address

:

47, JALAN SUNGAI CONGKAK 32/43, BUKIT RIMAU, 40460 SHAH ALAM, SELANGOR, MALAYSIA.

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

HSBC BANK MALAYSIA BHD

 

 

ENCUMBRANCE (S)

 

Charge No

Creation Date

Charge Description

Chargee Name

Total Charge

Status

1

24/04/2008

TRADE FINANCING GENERAL AGREEMENT

HSBC 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

Percentage

:

80%

Overseas

:

YES

Percentage

:

20%

Import Countries

:

ASIA



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

OVERALL PAYMENT HABIT

Prompt 0-30 Days

[

]

Good 31-60 Days

[

X

]

Average 61-90 Days

[

]

Fair 91-120 Days

[

]

Poor >120 Days

[

]

 

CLIENTELE

 

Local

:

YES

Domestic Markets

:

MALAYSIA

Overseas

:

YES

Export Market

:

EGYPT

SOUTH AFRICA

ASIA

Credit Term

:

30 - 60 DAYS

Payment Mode

:

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

 

OPERATIONS

 

Goods Traded

:

PALM OILS & VEGETABLE OILS

Product Brand Name

:

IFFCO

Ownership of premises

:

LEASED/RENTED

 

Total Number of Employees:

 

YEAR

2015

2014

2012

2011

2010

GROUP

N/A

N/A

N/A

N/A

N/A

COMPANY

52

20

20

20

20

 

Branch

:

NO

Other Information:


The Subject is principally engaged in the (as a / as an) trading of palm oils & vegetable oil. 

The Subject is under IFFCO Group of Companies, which is based in United Arab Emirates.

The Subject acts as a buying house of refined vegetable oils for its related companies in overseas. 


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

0321742020

Current Telephone Number

:

03-21742020

Match

:

YES

Address Provided by Client

:

LOT A & B, TOWER 2, ETIQA TWINS, 11, JALAN PINANG, LEVEL 22,50450,KUALA LUMPUR,WILAYAH PERSEKUTUAN.

Current Address

:

LOT A & B, TOWER 2, ETIQA TWINS, 11, JALAN PINANG, LEVEL 22, 50450 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Match

:

YES

Latest Financial Accounts

:

YES

 

Other Investigations


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


FINANCIAL ANALYSIS

 

Profitability

Turnover

:

Increased

[

2010 - 2014

]

Profit/(Loss) Before Tax

:

Increased

[

2010 - 2014

]

Return on Shareholder Funds

:

Acceptable

[

24.56%

]

Return on Net Assets

:

Favourable

[

32.08%

]

The Subject's turnover increased steadily as the demand for its products / services increased due to the goodwill built up over the years.The higher profit could be attributed to the increase in turnover. The Subject's management had generated acceptable return for its shareholders using its assets.

Working Capital Control

Stock Ratio

:

Nil

[

0 Days

]

Debtor Ratio

:

Favourable

[

35 Days

]

Creditors Ratio

:

Favourable

[

19 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 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

[

1.20 Times

]

Current Ratio

:

Unfavourable

[

1.20 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

:

Favourable

[

277.39 Times

]

Gearing Ratio

:

Favourable

[

0.00 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 :

Generally, the Subject's performance has improved with higher turnover and profit. 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. With the favourable interest cover, the Subject could be able to service all the accrued interest without facing any difficulties. 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 : STABLE

 

 

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

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 of palm oils & vegetable oil. 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. The Subject is a large entity with strong capital position of MYR 10,000,000. We are confident with the Subject's business and its future growth prospect. Having strong support from its holding company has enabled the Subject to remain competitive despite the challenging business environment. 

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 moderate size company, the Subject has a total workforce of 52 employees in its business operations. Overall, we regard that the Subject's management capability is average. This indicates that the Subject has greater potential to improve its business performance and raising income for the Subject. 

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 a favourable 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. 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. Given a positive net worth standing at MYR 23,251,680, 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 promptly.

 

 

PROFIT AND LOSS ACCOUNT

 

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

IFFCO (S.E.A.) SDN. BHD.

 

Financial Year End

2014-06-30

2013-06-30

2012-06-30

2011-12-31

2010-12-31

Months

12

12

6

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

1,009,447,920

451,751,889

434,726,344

1,202,467,529

846,717,492

Other Income

1,327,013

577,434

681,822

1,698,602

145,106

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

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

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

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

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

Total Turnover

1,010,774,933

452,329,323

435,408,166

1,204,166,131

846,862,598

Costs of Goods Sold

(993,715,003)

(436,103,637)

(429,565,368)

(1,191,064,004)

(838,261,107)

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

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

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

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

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

Gross Profit

17,059,930

16,225,686

5,842,798

13,102,127

8,601,491

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

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

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

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

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

PROFIT/(LOSS) FROM OPERATIONS

7,799,221

5,634,210

1,273,043

4,038,997

1,502,036

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

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

7,799,221

5,634,210

1,273,043

4,038,997

1,502,036

Taxation

(2,088,567)

(278,855)

(322,331)

(1,114,292)

(423,874)

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

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

5,710,654

5,355,355

950,712

2,924,705

1,078,162

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

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

As previously reported

10,541,026

5,185,671

4,234,959

1,310,254

232,092

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

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

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

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

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

As restated

10,541,026

5,185,671

4,234,959

1,310,254

232,092

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

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

16,251,680

10,541,026

5,185,671

4,234,959

1,310,254

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

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

16,251,680

10,541,026

5,185,671

4,234,959

1,310,254

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

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

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

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

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

INTEREST EXPENSE (as per notes to P&L)

Others

28,218

33,505

477,062

-

1,221,250

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

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

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

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

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

28,218

33,505

477,062

-

1,221,250

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

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

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

-

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

DEPRECIATION (as per notes to P&L)

933,686

447,276

221,398

315,207

188,083

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

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

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

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

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

933,686

447,276

221,398

315,207

188,083

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

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

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

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

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

 

 

 

 

 

 

 

BALANCE SHEET

 

IFFCO (S.E.A.) SDN. BHD.

 

ASSETS EMPLOYED:

FIXED ASSETS

5,127,734

4,871,101

2,775,587

2,819,707

2,217,455

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

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

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

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

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

TOTAL LONG TERM ASSETS

5,127,734

4,871,101

2,775,587

2,819,707

2,217,455

Trade debtors

97,953,446

89,740,524

17,788,342

32,444,673

245,069,268

Other debtors, deposits & prepayments

6,127,529

4,546,798

4,344,838

3,940,240

1,202,336

Short term deposits

-

-

1,610,058

2,100,000

-

Amount due from related companies

-

1,529,543

-

-

-

Cash & bank balances

10,459,316

8,082,380

24,461,377

17,496,989

9,438,208

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

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

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

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

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

TOTAL CURRENT ASSETS

114,540,291

103,899,245

48,204,615

55,981,902

255,709,812

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

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

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

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

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

TOTAL ASSET

119,668,025

108,770,346

50,980,202

58,801,609

257,927,267

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

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

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

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

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

CURRENT LIABILITIES

Trade creditors

51,430,874

47,352,052

428,393

4,346,324

165,254,979

Other creditors & accruals

43,538,229

43,004,038

36,117,281

41,718,602

11,027,037

Bill & acceptances payable

-

-

-

-

78,639,307

Amounts owing to holding company

-

-

-

18,936

96,987

Amounts owing to related companies

3,355

-

848,386

326,733

-

Provision for taxation

292,503

584,836

569,083

324,667

23,000

Other liabilities

-

-

-

-

997,896

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

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

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

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

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

TOTAL CURRENT LIABILITIES

95,264,961

90,940,926

37,963,143

46,735,262

256,039,206

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

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

19,275,330

12,958,319

10,241,472

9,246,640

(329,394)

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

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

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

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

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

TOTAL NET ASSETS

24,403,064

17,829,420

13,017,059

12,066,347

1,888,061

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

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

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

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

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

SHARE CAPITAL

Ordinary share capital

7,000,000

7,000,000

7,000,000

7,000,000

350,000

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

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

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

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

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

TOTAL SHARE CAPITAL

7,000,000

7,000,000

7,000,000

7,000,000

350,000

Retained profit/(loss) carried forward

16,251,680

10,541,026

5,185,671

4,234,959

1,310,254

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

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

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

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

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

TOTAL RESERVES

16,251,680

10,541,026

5,185,671

4,234,959

1,310,254

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

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

23,251,680

17,541,026

12,185,671

11,234,959

1,660,254

Deferred taxation

1,151,384

288,394

831,388

831,388

227,807

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

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

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

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

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

TOTAL LONG TERM LIABILITIES

1,151,384

288,394

831,388

831,388

227,807

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

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

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

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

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

24,403,064

17,829,420

13,017,059

12,066,347

1,888,061

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

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

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

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

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

 

 

 

 

 

 

 

FINANCIAL RATIO

 

IFFCO (S.E.A.) SDN. BHD.

 

TYPES OF FUNDS

Cash

10,459,316

8,082,380

26,071,435

19,596,989

9,438,208

Net Liquid Funds

10,459,316

8,082,380

26,071,435

19,596,989

(69,201,099)

Net Liquid Assets

19,275,330

12,958,319

10,241,472

9,246,640

(329,394)

Net Current Assets/(Liabilities)

19,275,330

12,958,319

10,241,472

9,246,640

(329,394)

Net Tangible Assets

24,403,064

17,829,420

13,017,059

12,066,347

1,888,061

Net Monetary Assets

18,123,946

12,669,925

9,410,084

8,415,252

(557,201)

PROFIT & LOSS ITEMS

Earnings Before Interest & Tax (EBIT)

7,827,439

5,667,715

1,750,105

4,038,997

2,723,286

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

8,761,125

6,114,991

1,971,503

4,354,204

2,911,369

BALANCE SHEET ITEMS

Total Borrowings

0

0

0

0

78,639,307

Total Liabilities

96,416,345

91,229,320

38,794,531

47,566,650

256,267,013

Total Assets

119,668,025

108,770,346

50,980,202

58,801,609

257,927,267

Net Assets

24,403,064

17,829,420

13,017,059

12,066,347

1,888,061

Net Assets Backing

23,251,680

17,541,026

12,185,671

11,234,959

1,660,254

Shareholders' Funds

23,251,680

17,541,026

12,185,671

11,234,959

1,660,254

Total Share Capital

7,000,000

7,000,000

7,000,000

7,000,000

350,000

Total Reserves

16,251,680

10,541,026

5,185,671

4,234,959

1,310,254

LIQUIDITY (Times)

Cash Ratio

0.11

0.09

0.69

0.42

0.04

Liquid Ratio

1.20

1.14

1.27

1.20

1.00

Current Ratio

1.20

1.14

1.27

1.20

1.00

WORKING CAPITAL CONTROL (Days)

Stock Ratio

0

0

0

0

0

Debtors Ratio

35

73

15

10

106

Creditors Ratio

19

40

0

1

72

SOLVENCY RATIOS (Times)

Gearing Ratio

0

0

0

0

47.37

Liabilities Ratio

4.15

5.20

3.18

4.23

154.35

Times Interest Earned Ratio

277.39

169.16

3.67

0

2.23

Assets Backing Ratio

3.49

2.55

1.86

1.72

5.39

PERFORMANCE RATIO (%)

Operating Profit Margin

0.77

1.25

0.29

0.34

0.18

Net Profit Margin

0.57

1.19

0.22

0.24

0.13

Return On Net Assets

32.08

31.79

13.44

33.47

144.24

Return On Capital Employed

32.08

31.79

13.44

33.47

144.24

Return On Shareholders' Funds/Equity

24.56

30.53

7.80

26.03

64.94

Dividend Pay Out Ratio (Times)

0

0

0

0

0

NOTES TO ACCOUNTS

Contingent Liabilities

0

0

0

0

0

 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.65.55

UK Pound

1

Rs.99.17

Euro

1

Rs.73.08

 

 

INFORMATION DETAILS

 

Analysis Done by :

KAR

 

 

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.