MIRA INFORM REPORT

 

 

Report No. :

345608

Report Date :

21.10.2015

 

IDENTIFICATION DETAILS

 

Name :

HOT RED SDN. BHD.

 

 

Registered Office :

28, Lorong Medan Tuanku Satu, 3rd Floor, 50300 Kuala Lumpur, Wilayah Persekutuan

 

 

Country :

Malaysia

 

 

Financials (as on) :

31.12.2013

 

 

Date of Incorporation :

31.07.2009

 

 

Com. Reg. No.:

866720-M

 

 

Legal Form :

Private Limited

 

 

Line of Business :

Subject is engaged in the distributing agents and consultants for firefighting products and equipments.

 

 

No. of Employees :

Not Available

 

 

RATING & COMMENTS

 

MIRA’s Rating :

B

 

RATING

STATUS

PROPOSED CREDIT LINE

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

Small

 

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 – 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.

:

866720-M

COMPANY NAME

:

HOT RED SDN. BHD.

FORMER NAME

:

N/A

INCORPORATION DATE

:

31/07/2009

 

 

 

 

 

 

COMPANY STATUS

:

EXIST

LEGAL FORM

:

PRIVATE LIMITED

LISTED STATUS

:

NO

 

 

 

 

 

 

REGISTERED ADDRESS

:

28, LORONG MEDAN TUANKU SATU, 3RD FLOOR, 50300 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

:

B-1-1 LEVEL 3, BLOCK B PLAZA UNCHANGMAS 3, JALAN LOKE YEW,, 56100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

:

03-92021817

FAX.NO.

:

03-92007154

CONTACT PERSON

:

JUDE SAVIO IMMANUEL A/L ALPHONES ( DIRECTOR )

 

 

 

INDUSTRY CODE

:

46596

PRINCIPAL ACTIVITY

:

DISTRIBUTING AGENTS AND CONSULTANTS FOR FIRE FIGHTING PRODUCTS AND EQUIPMENTS.

AUTHORISED CAPITAL

:

MYR 100,000.00 DIVIDED INTO 
ORDINARY SHARE 100,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

:

MYR 100,000.00 DIVIDED INTO 
ORDINARY SHARES 1,000 CASH AND 99,000 OTHERWISE OF MYR 1.00 EACH.

 

 

 

SALES

:

MYR 3,727,454 [2013]

NET WORTH

:

MYR 127,731 [2013]

 

 

 

STAFF STRENGTH

:

N/A

BANKER (S)

:

MALAYAN BANKING BHD

LITIGATION

:

CLEAR

DEFAULTER CHECK

:

CLEAR

FINANCIAL CONDITION

:

LIMITED

PAYMENT

:

N/A

MANAGEMENT CAPABILITY

:

AVERAGE

 

 

 

COMMERCIAL RISK

:

MODERATE

CURRENCY EXPOSURE

:

N/A

GENERAL REPUTATION

:

SATISFACTORY

INDUSTRY OUTLOOK

:

AVERAGE GROWTH

 

HISTORY / BACKGROUND

 

The Subject is a private limited company and is allowed to have a minimum of one and a maximum of forty-nine shareholders. As a private limited company, the Subject must have at least two directors. A private limited company is a separate legal entity from its shareholders. As a separate legal entity, the Subject is capable of owning assets, entering into contracts, sue or be sued by other companies. The liabilities of the shareholders are to the extent of the equity they have taken up and the creditors cannot claim on shareholders' personal assets even if the Subject is insolvent. The Subject is governed by the Companies Act, 1965 and the company must file its annual returns, together with its financial statements with the Registrar of Companies.

 

The Subject is principally engaged in the (as a / as an) distributing agents and consultants for fire fighting products and equipments..

 

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 100,000.00

MYR 100,000.00

15/02/2013

MYR 100,000.00

MYR 1,000.00

 

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

 

Current Shareholder(s) :

Name

Address

IC/PP/Loc No

Shareholding

(%)

MR. JUDE SAVIO IMMANUEL A/L ALPHONES +

CTE-5, BLOCK A, GRANDEUR TOWER, PANDAN INDAH, 7TH FLOOR, 55100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

801227-14-5969

50,000.00

50.00

MS. SHARMINI A/P K. RAJINDRAM +

1-12-8, SERI MAS CONDOMINIUM, AMBER TOWER 1, CHERAS, 56100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

690210-10-6446 A1265351

50,000.00

50.00

 

 

 

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

------

 

 

 

100,000.00

100.00

 

 

 

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

=====

 

+ Also Director

 

Former Shareholder(s) :

Name

Country

IC/PP/Loc No

Shareholding

Last Updated

JAGDEV SINGH A/L SANTOKH SINGH

MALAYSIA

730520-08-5795

N/A

N/A

RANBIR KAUR A/P HARJIT SINGH

MALAYSIA

781231-14-6010

N/A

N/A

 

 

DIRECTORS

 

DIRECTOR 1

 

Name Of Subject

:

MR. JUDE SAVIO IMMANUEL A/L ALPHONES

Address

:

CTE-5, BLOCK A, GRANDEUR TOWER, PANDAN INDAH, 7TH FLOOR, 55100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

New IC No

:

801227-14-5969

Date of Birth

:

27/12/1980

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

20/10/2010

 

 

 

 

 

 

 

 

 

 

 

 

 

DIRECTOR 2

 

Name Of Subject

:

MS. SHARMINI A/P K. RAJINDRAM

Address

:

1-12-8, SERI MAS CONDOMINIUM, AMBER TOWER 1, CHERAS, 56100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

IC / PP No

:

A1265351

New IC No

:

690210-10-6446

Date of Birth

:

10/02/1969

 

 

 

Nationality

:

MALAYSIAN

Date of Appointment

:

20/10/2010

 

 

 

 

 

 

 

 

 

 

 

 



MANAGEMENT

 

 

 

1)

Name of Subject

:

JUDE SAVIO IMMANUEL A/L ALPHONES

 

Position

:

DIRECTOR

 

 

 

 

 

AUDITOR

 

Auditor

:

INPANA & ASSOCIATES

Auditor' Address

:

568-9-21, KOMPLEKS MUTIARA, 3 1/2, MILE, JALAN IPOH, 9TH FLOOR, 51200 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

 

 

 

 

 

 

 

COMPANY SECRETARIES

 

1)

Company Secretary

:

MR. RADA A/L PALANISAMY

 

IC / PP No

:

5189875

 

New IC No

:

570529-10-6433

 

Address

:

128, JALAN SG 9/1, TAMAN SERI GOMBAK, 68100 BATU CAVES, SELANGOR, MALAYSIA.

 

 

 

 

 

 

 

 

 

 

 

 

 

BANKING


Banking relations are maintained principally with :

1)

Name

:

MALAYAN BANKING 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

:

N/A

Overseas

:

N/A

 

 

 


The Subject refused to disclose its suppliers. 

 

CLIENTELE

 

Local

:

YES

Percentage

:

100%

Domestic Markets

:

MALAYSIA

Overseas

:

NO

 

 

 

 

 

 

 

 

 

Credit Term

:

N/A

 

 

 

 

 

 

Payment Mode

:

CHEQUES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

OPERATIONS

 

Goods Traded

:

FIRE FIGHTING PRODUCTS AND EQUIPMENTS.

 

 

 

 

 

Branch

:

NO

 

Other Information:


The Subject is principally engaged in the (as a / as an) distributing agents and consultants for fire fighting products and equipments.. 

The Subject deals with fire fighting equipment and security equipments. 


CURRENT INVESTIGATION

 

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client

:

03 9200 4585/ 03 9202 1817

Current Telephone Number

:

03-92021817

Match

:

YES

 

 

 

Address Provided by Client

:

SUITE B-1-1, BLOCK B, 3RD FLOOR, MENARA UNCANG EMAS JALAN LAKE YEW 55200 KUALA LUMPUR

Current Address

:

B-1-1 LEVEL 3, BLOCK B PLAZA UNCHANGMAS 3, JALAN LOKE YEW,, 56100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

Match

:

NO

 

 

 

Latest Financial Accounts

:

YES

 

Other Investigations


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

The address provided is incomplete.

The Subject refused to disclose its number of employees.


FINANCIAL ANALYSIS

 

Profitability

 

 

 

 

 

 

Turnover

:

Erratic

[

2010 - 2013

]

 

Profit/(Loss) Before Tax

:

Decreased

[

2010 - 2013

]

 

Return on Shareholder Funds

:

Unfavourable

[

(2.21%)

]

 

Return on Net Assets

:

Unfavourable

[

1.47%

]

 

 

 

 

 

 

 

 

The fluctuating turnover reflects the fierce competition among the existing and new market players.The Subject's profit fell sharply because of the high operating costs incurred. The Subject's unfavourable returns on shareholders' funds indicate the management's inefficiency in utilising its assets to generate returns.

 

 

 

 

 

 

 

Working Capital Control

 

 

 

 

 

 

Stock Ratio

:

Nil

[

0 Days

]

 

Debtor Ratio

:

Favourable

[

36 Days

]

 

Creditors Ratio

:

Favourable

[

0 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

[

1.03 Times

]

 

Current Ratio

:

Unfavourable

[

1.03 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

:

Unfavourable

[

2.99 Times

]

 

Gearing Ratio

:

Favourable

[

0.62 Times

]

 

 

 

 

 

 

 

 

The Subject incurred losses in the year. It did not generate sufficient income to service its interest.  If the situation does not improve, the Subject may be vulnerable to default in servicing the interest. The Subject was lowly geared thus it had a low financial risk. The Subject was mainly financed by its shareholders' funds and internally generated funds. In times of economic slowdown / downturn, the Subject being a lowly geared company, will be able to compete better than those companies which are highly geared in the same industry.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Overall Assessment :

 

 

 

 

 

 

The Subject recorded lower profits as its turnover showed a erratic trend. The Subject's management was unable to control its costs efficiently as its profit showed a downward trend. The Subject 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 as a lowly geared company, will be more secured compared to those highly geared companies. It has the ability to meet all its long term obligations.

 

 

 

 

 

 

 

Overall financial condition of the Subject : LIMITED

 

 

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

46596 : Wholesale of lift escalators, air-conditioning, security and fire fighting equipment

 

 

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 2009, the Subject is a Private Limited company, focusing on distributing agents and consultants for fire fighting products and equipments. Having been in business for more than 5 years, the Subject has established a remarkable clientele base for itself which has contributed to its business growth. Presently, the issued and paid up capital of the Subject stands at MYR 100,000. 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 should have build up its clientele base and received supports from its regular customers. Investigation revealed that the Subject's interest lies mostly in the local market. Thus, any adverse changes to the local economy might have a negative impact on the Subject's business performance. 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. 

Financially, the Subject registered a higher turnover compared to previous year. However, its profits showed a reverse trend. The lower profit achieved was a result of higher operating cost and increased competition. The Subject has generated an unfavourable return on shareholders' funds indicating that the management was inefficient in utilising its funds to generate return. 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 lowly geared company, the Subject is exposed to low financial risk as it is mainly dependent on its internal funds to finance its business needs. 

The industry shows an upward trend and this trend is very likely to sustain in the near terms. Hence, the Subject is expected to benefit from the favourable outlook of the industry. 

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

 

 

PROFIT AND LOSS ACCOUNT

 

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

HOT RED SDN. BHD.

 

Financial Year End

2013-12-31

2012-12-31

2011-12-31

2010-12-31

Months

12

12

12

12

Consolidated Account

Company

Company

Company

Company

Audited Account

YES

YES

YES

YES

Unqualified Auditor's Report (Clean Opinion)

YES

YES

YES

YES

Financial Type

FULL

FULL

FULL

FULL

Currency

MYR

MYR

MYR

MYR

 

 

 

 

 

TURNOVER

3,727,454

642,659

714,065

-

 

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

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

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

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

Total Turnover

3,727,454

642,659

714,065

-

Costs of Goods Sold

(3,407,623)

(448,807)

(498,674)

-

 

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

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

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

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

Gross Profit

319,831

193,852

215,391

-

 

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

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

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

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

 

 

 

 

 

PROFIT/(LOSS) FROM OPERATIONS

1,924

7,429

30,816

(3,640)

 

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

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

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

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

PROFIT/(LOSS) BEFORE TAXATION

1,924

7,429

30,816

(3,640)

Taxation

(4,743)

(2,086)

(1,969)

-

 

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

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

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

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

PROFIT/(LOSS) AFTER TAXATION

(2,819)

5,343

28,847

(3,640)

 

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

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

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

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

RETAINED PROFIT/(LOSS) BROUGHT FORWARD

 

 

 

 

As previously reported

30,550

25,207

(3,640)

-

 

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

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

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

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

As restated

30,550

25,207

(3,640)

-

 

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

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

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

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

PROFIT AVAILABLE FOR APPROPRIATIONS

27,731

30,550

25,207

(3,640)

 

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

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

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

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

RETAINED PROFIT/(LOSS) CARRIED FORWARD

27,731

30,550

25,207

(3,640)

 

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

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

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

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

 

 

 

 

 

INTEREST EXPENSE (as per notes to P&L)

 

 

 

 

Hire purchase

965

-

-

-

 

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

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

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

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

 

965

-

-

-

 

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

-

-

-

 

 

 

 

 

DEPRECIATION (as per notes to P&L)

32,498

14,286

14,286

-

 

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

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

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

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

 

32,498

14,286

14,286

-

 

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

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

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

 

 

 

 

 

 

 

BALANCE SHEET

 

HOT RED SDN. BHD.

 

ASSETS EMPLOYED:

 

 

 

 

FIXED ASSETS

172,348

112,884

127,170

-

 

 

 

 

 

 

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

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

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

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

TOTAL LONG TERM ASSETS

172,348

112,884

127,170

-

 

 

 

 

 

Trade debtors

369,590

-

-

-

Other debtors, deposits & prepayments

408,241

5,800

5,800

-

Cash & bank balances

101,741

1,687

1,168

1,000

 

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

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

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

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

TOTAL CURRENT ASSETS

879,572

7,487

6,968

1,000

 

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

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

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

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

TOTAL ASSET

1,051,920

120,371

134,138

1,000

 

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

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

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

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

 

 

 

 

 

Other creditors & accruals

465,031

12,280

6,740

1,340

Hire purchase & lease creditors

10,037

-

-

-

Amounts owing to director

371,782

72,486

99,222

2,300

Provision for taxation

8,798

4,055

1,969

-

 

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

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

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

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

TOTAL CURRENT LIABILITIES

855,648

88,821

107,931

3,640

 

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

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

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

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

NET CURRENT ASSETS/(LIABILITIES)

23,924

(81,334)

(100,963)

(2,640)

 

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

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

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

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

TOTAL NET ASSETS

196,272

31,550

26,207

(2,640)

 

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

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

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

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

 

 

 

 

 

SHARE CAPITAL

 

 

 

 

Ordinary share capital

100,000

1,000

1,000

1,000

 

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

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

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

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

TOTAL SHARE CAPITAL

100,000

1,000

1,000

1,000

 

 

 

 

 

Retained profit/(loss) carried forward

27,731

30,550

25,207

(3,640)

 

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

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

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

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

TOTAL RESERVES

27,731

30,550

25,207

(3,640)

 

 

 

 

 

 

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

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

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

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

SHAREHOLDERS' FUNDS/EQUITY

127,731

31,550

26,207

(2,640)

 

 

 

 

 

Hire purchase creditors

68,541

-

-

-

 

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

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

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

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

TOTAL LONG TERM LIABILITIES

68,541

-

-

-

 

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

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

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

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

 

196,272

31,550

26,207

(2,640)

 

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

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

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

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

 

 

 

 

 

 

 

 

 

 

 

FINANCIAL RATIO

 

HOT RED SDN. BHD.

 

TYPES OF FUNDS

 

 

 

 

Cash

101,741

1,687

1,168

1,000

Net Liquid Funds

101,741

1,687

1,168

1,000

Net Liquid Assets

23,924

(81,334)

(100,963)

(2,640)

Net Current Assets/(Liabilities)

23,924

(81,334)

(100,963)

(2,640)

Net Tangible Assets

196,272

31,550

26,207

(2,640)

Net Monetary Assets

(44,617)

(81,334)

(100,963)

(2,640)

PROFIT & LOSS ITEMS

 

 

 

 

Earnings Before Interest & Tax (EBIT)

2,889

7,429

0

(3,640)

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

35,387

21,715

45,102

(3,640)

BALANCE SHEET ITEMS

 

 

 

 

Total Borrowings

78,578

0

0

0

Total Liabilities

924,189

88,821

107,931

3,640

Total Assets

1,051,920

120,371

134,138

1,000

Net Assets

196,272

31,550

26,207

(2,640)

Net Assets Backing

127,731

31,550

26,207

(2,640)

Shareholders' Funds

127,731

31,550

26,207

(2,640)

Total Share Capital

100,000

1,000

1,000

1,000

Total Reserves

27,731

30,550

25,207

(3,640)

LIQUIDITY (Times)

 

 

 

 

Cash Ratio

0.12

0.02

0.01

0.27

Liquid Ratio

1.03

0.08

0.06

0.27

Current Ratio

1.03

0.08

0.06

0.27

WORKING CAPITAL CONTROL (Days)

 

 

 

 

Stock Ratio

0

0

0

0

Debtors Ratio

36

0

0

0

Creditors Ratio

0

0

0

0

SOLVENCY RATIOS (Times)

 

 

 

 

Gearing Ratio

0.62

0

0

0

Liabilities Ratio

7.24

2.82

4.12

(1.38)

Times Interest Earned Ratio

2.99

0

0

0

Assets Backing Ratio

1.96

31.55

26.21

(2.64)

PERFORMANCE RATIO (%)

 

 

 

 

Operating Profit Margin

0.05

1.16

4.32

0

Net Profit Margin

(0.08)

0.83

4.04

0

Return On Net Assets

1.47

23.55

117.59

137.88

Return On Capital Employed

1.40

23.55

117.59

137.88

Return On Shareholders' Funds/Equity

(2.21)

16.94

110.07

137.88

Dividend Pay Out Ratio (Times)

0

0

0

0

NOTES TO ACCOUNTS

 

 

 

 

Contingent Liabilities

0

0

0

0

 

FOREIGN EXCHANGE RATES

 

Currency
Unit

Indian Rupees

US Dollar

1

Rs.64.89

UK Pound

1

Rs.100.39

Euro

1

Rs.73.52

 

 

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.