MIRA INFORM REPORT

Report No. :	340913
Report Date :	14.09.2015

IDENTIFICATION DETAILS

Name :	ZEE FURNITURE SDN. BHD.

Formerly Known As :	ZEALOT MANUFACTURING SDN BHD RANI'S SAJNANI SDN BHD

Registered Office :	Faber Imperia, Court, Jalan Sultan Ismail, Level 15-2, 50250 Kuala Lumpur, Wilayah Persekutuan

Country :	Malaysia

Financials (as on) :	31.12.2013

Date of Incorporation :	25.02.1998

Com. Reg. No.:	458237-X

Legal Form :	Private Limited

Line of Business :	Wholesale of Furniture’s

No. of Employee :	Not Available

RATING & COMMENTS

MIRA’s Rating :

RATING		STATUS	PROPOSED CREDIT LINE
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small

Status :	Moderate

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

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 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 also trying to lessen its dependence on state oil producer Petronas. The oil and gas sector supplied about 29% of government revenue in 2014. 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. 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.

458237-X

COMPANY NAME

ZEE FURNITURE SDN. BHD.

FORMER NAME

ZEALOT MANUFACTURING SDN BHD (24/08/2007)
RANI'S SAJNANI SDN BHD (14/03/2007)

INCORPORATION DATE

25/02/1998

COMPANY STATUS

EXIST

LEGAL FORM

PRIVATE LIMITED

LISTED STATUS

REGISTERED ADDRESS

FABER IMPERIA, COURT, JALAN SULTAN ISMAIL, LEVEL 15-2, 50250 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

BUSINESS ADDRESS

LOT 6.04 E, WISMA CENTRAL, JALAN AMPANG, 6TH FLOOR, 50450 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

TEL.NO.

03-21662890

FAX.NO.

03-21661890

CONTACT PERSON

MAHESH ATALRAI KESWANI ( MANAGING DIRECTOR )

INDUSTRY CODE

46491

PRINCIPAL ACTIVITY

WHOLESALE OF FURNITURES

AUTHORISED CAPITAL

MYR 1,000,000.00 DIVIDED INTO
ORDINARY SHARE 1,000,000.00 OF MYR 1.00 EACH.

ISSUED AND PAID UP CAPITAL

MYR 600,000.00 DIVIDED INTO
ORDINARY SHARES 350,003 CASH AND 249,997 OTHERWISE OF MYR 1.00 EACH.

SALES

MYR 14,769,470 [2013]

NET WORTH

MYR 918,718 [2013]

STAFF STRENGTH

N/A

BANKER (S)

HSBC BANK MALAYSIA BHD

LITIGATION

CLEAR

DEFAULTER CHECK

CLEAR

FINANCIAL CONDITION

LIMITED

PAYMENT

GOOD

MANAGEMENT CAPABILITY

AVERAGE

COMMERCIAL RISK

MODERATE

CURRENCY EXPOSURE

HIGH

GENERAL REPUTATION

SATISFACTORY

INDUSTRY OUTLOOK

MARGINAL GROWTH

HISTORY / BACKGROUND

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

The Subject is principally engaged in the (as a / as an) wholesale of furnitures.

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 1,000,000.00	MYR 600,000.00
13/05/2011	MYR 500,000.00	MYR 500,000.00
13/09/2000	MYR 500,000.00	MYR 350,003.00
13/02/1998	MYR 100,000.00	MYR 3.00

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

Current Shareholder(s) :

Name	Address	IC/PP/Loc No	Shareholding	(%)
MAHESH ATALRAI KESWANI +	37, JALAN TEMPINIS KANAN, LUCKY GARDEN, BANGSAR, 59100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.	Z1809516	421,497.00	70.25
MS. ASHA DEVI A/P KISHINCHAND +	NO 37 JALAN TEMPINIS KANAN, LUCKY GARDEN, BANGSAR, 59100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.	600409-11-5372	178,503.00	29.75
			---------------	------
			600,000.00	100.00
			============	=====

+ Also Director

DIRECTORS

DIRECTOR 1

Name Of Subject	:	SONIA MAHESH KESWANI
Address	:	NO 37, JALAN TEMPINIS KANAN, LUCKY GARDEN, BANGSAR, 59100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	Z2430866




Date of Appointment	:	03/11/2014

DIRECTOR 2

Name Of Subject	:	MS. ASHA DEVI A/P KISHINCHAND
Address	:	NO 37 JALAN TEMPINIS KANAN, LUCKY GARDEN, BANGSAR, 59100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

New IC No	:	600409-11-5372
Date of Birth	:	09/04/1960

Nationality	:	MALAYSIAN
Date of Appointment	:	09/09/2000

DIRECTOR 3

Name Of Subject	:	MAHESH ATALRAI KESWANI
Address	:	37, JALAN TEMPINIS KANAN, LUCKY GARDEN, BANGSAR, 59100 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.
IC / PP No	:	Z1809516




Date of Appointment	:	09/09/2000

MANAGEMENT

1)	Name of Subject	:	MAHESH ATALRAI KESWANI
	Position	:	MANAGING DIRECTOR

AUDITOR

Auditor	:	SJ GRANT THORNTON
Auditor' Address	:	SHERATON IMPERIAL COURT, JALAN SULTAN ISMAIL, LEVEL 11, 50250 KUALA LUMPUR, WILAYAH PERSEKUTUAN, MALAYSIA.

COMPANY SECRETARIES

1)	Company Secretary	:	MR. M. CHANDRASEGARAN A/L S. MURUGASU
	IC / PP No	:	5573205
	New IC No	:	581020-06-5169
	Address	:	NO.1,JALAN SS 18/1, SUBANG JAYA, 47500 SUBANG JAYA, SELANGOR, MALAYSIA.

2)	Company Secretary	:	MS. LIM SECK WAH
	IC / PP No	:	5878183
	New IC No	:	591223-02-5430
	Address	:	41 JALAN TAMING INDAH 2, TAMAN TAMING INDAH, BANDAR SG LONG, 43000 KAJANG, 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	16/07/2009	TRADE FINANCING GENERAL AGREEMENT	HSBC BANK MALAYSIA BHD	-	Unsatisfied
2	16/07/2009	TRADE FINANCING GENERAL AGREEMENT	HSBC BANK MALAYSIA BHD	-	Unsatisfied
3	24/10/2011	TRADE FINANCING GENERAL AGREEMENT	HSBC BANK MALAYSIA BHD	-	Unsatisfied

LITIGATION CHECK AGAINST SUBJECT

* A check has been conducted in our databank againt the Subject whether the Subject has been involved in any litigation. Our databank consists of 99% of the wound up companies in Malaysia.

No legal action was found in our databank.

No winding up petition was found in our databank.

DEFAULTER CHECK AGAINST SUBJECT

* We have checked through the Subject in our defaulters' database which comprised of debtors that have been blacklisted by our customers and debtors that have been placed or assigned to us for collection.

No blacklisted record & debt collection case was found in our defaulters' databank.

PAYMENT RECORD

SOURCES OF RAW MATERIALS:
Local	:	YES
Overseas	:	YES
Import Countries	:	CHINA,EUROPE

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

[

]

Poor >120 Days

[

]

CLIENTELE

Local	:	NO

Overseas	:	YES	Percentage	:	100%
Export Market	:	ASIA MIDDLE EAST
Credit Term	:	AS AGREED

Payment Mode	:	CHEQUES TELEGRAPHIC TRANSFER (TT)

OPERATIONS

Goods Traded

FURNITURE

Ownership of premises

LEASED/RENTED

Total Number of Employees:
YEAR	2014	2013	2012	2011	2010
GROUP	N/A	N/A	N/A	N/A	N/A
COMPANY	10	10	10	10	10

Branch

Other Information:

The Subject is principally engaged in the (as a / as an) wholesale of furnitures.

The Subject's products ranges are includes sofas, dining sets, office tables & chairs, cupboards and others.

According to the Subject, it also provides products based on the customers' requirements.

CURRENT INVESTIGATION

Latest fresh investigations carried out on the Subject indicated that :

Telephone Number Provided By Client	:	N/A
Current Telephone Number	:	03-21662890
Match	:	N/A

Address Provided by Client	:	LOT 6 04E, 6TH FLOOR WISMA CENTRAL JALAN AMPANG 50450 KUALA LUMPUR
Current Address	:	LOT 6.04 E, WISMA CENTRAL, JALAN AMPANG, 6TH FLOOR, 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.

The Subject refused to disclose its number of employees.

FINANCIAL ANALYSIS

Profitability
Turnover	:	Decreased	[	2009 - 2013	]
Profit/(Loss) Before Tax	:	Decreased	[	2009 - 2013	]
Return on Shareholder Funds	:	Unfavourable	[	3.37%	]
Return on Net Assets	:	Acceptable	[	15.48%	]

The continuous fall in turnover could be due to the lower demand for the Subject's products / services.The Subject's profit fell sharply because of the high operating costs incurred. The unfavourable return on shareholders' funds could indicate that the Subject was inefficient in utilising its assets to generate returns.

Working Capital Control
Stock Ratio	:	Nil	[	0 Days	]
Debtor Ratio	:	Favourable	[	33 Days	]
Creditors Ratio	:	Favourable	[	12 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	[	1.39 Times	]
Current Ratio	:	Unfavourable	[	1.39 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	[	1.43 Times	]
Gearing Ratio	:	Favourable	[	0.00 Times	]

The Subject's interest cover was low. If its profits fall or when interest rate rises, it may not be able to meet all its interest payment. 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 performance deteriorated over the years with lower 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. If there is a fall in the Subject's profit or any increase in interest rate, the Subject may not be able to generate sufficient cash-flow to service its interest. 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 : 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
46491 : Wholesale of household furniture

INDUSTRY :	FURNITURE & FIXTURES


Malaysia's Furniture Manufacturing Industry has been blooming in recent years. Malaysia ranks comfortably as the 10th largest exporter of furniture in the world in 2014. It exports 80% of their total furniture production around the world. With existing strong export base like Japan, United States and Australia, the nation continues its tremendous growth towards Saudi Arabia, Philippines and Russia. Malaysia is believed to diversify their export base to countries like Algeria, Greece, Puerto Rico, Libya and other countries awaiting confirmation.

Increased demand from major export destinations such as the US, Japan and Australia for Malaysian made furniture contributed to the higher output of wooden and cane furniture, which rebounded by 2.2% in the first seven months of 2014. Thus, shipments of wood products rebounded by 4.7% in the same time mainly driven by export growth of wooden furniture (13.4%) to the US, Japan and Australia. Amid higher demand, exports of bedroom furniture and seats with wooden frame increased significantly by 21.6% and 15.2%. However, in 2013, Malaysia's furniture export decreased 8.1% compared to 2012. Furniture exports to the United States in 2013, which is the largest market, also recorded a decrease of 6.1% compared to 2012. This performance was nevertheless commendable, taking into account the slowdown in the global economy in 2013, especially in the United States and Euro zone countries.

Despite numerous economic downturns, the industry is still supported by a strong global demand. While lower priced Chinese and Vietnamese furniture pose strong competition, Malaysian furniture continues to set itself apart with original design that places importance on aesthetics as well as its good work ethics. The government also plays an important role in nurturing the industry. Providing Pioneer Status for tax exemption and Investment Tax Allowance, the pro-business environment makes doing business easier and faster. With a business-friendly environment, good quality products and a high potential market, the Malaysian furniture industry is poised to exceed expectations and to continue its exponential growth.

Conclusively, Malaysia has always been known for its wood based furniture, owing to its natural resources. The government has set an annual growth target of 6.5% for wood based furniture, estimated to reach up to RM53 billion by year 2020. In recent years, the growth has shifted from producing general products towards designing its own, and this has been the key in propelling Malaysia onto the international arena. Popular with overseas buyers of the middle to high category, foreign buyers look to Malaysia for manufacturers who can meet their high production demand.

OVERALL INDUSTRY OUTLOOK : Marginal Growth

CREDIT RISK EVALUATION & RECOMMENDATION

Incorporated in 1998, the Subject is a Private Limited company, focusing on wholesale of furnitures. 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. Presently, the issued and paid up capital of the Subject stands at MYR 600,000. We considered that the Subject's business position in the market is much dependent on the efforts of its directors.

The Subject focuses only on overseas market. This global approach has enabled the Subject to generate a better growth sales. Being an export-oriented company, the Subject however is subjected to certain inherent risk of global economy slowdown, foreign currencies fluctuations and stiff competition in the international market. 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.

The Subject's business performance showed a reverse trend as both its turnover and pre-tax profit have decreased compared to the previous year. 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 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 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 maturity stage and only enjoying a marginal growth. The steady growth of the country's economy will further enhance the industry activities. Thus, the Subject's future performance is very much depend on its marketing strategies in order to retain its position in the market.

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

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	2010-12-31	2009-12-31
Months	12	12	12	12	12
Consolidated Account	Company	Company	Company	Company	Company
Audited Account	YES	YES	YES	YES	YES
Unqualified Auditor's Report (Clean Opinion)	YES	YES	YES	YES	YES
Financial Type	FULL	FULL	FULL	FULL	FULL
Currency	MYR	MYR	MYR	MYR	MYR

TURNOVER	14,769,470	17,396,174	18,317,256	15,316,696	10,345,377
	----------------	----------------	----------------	----------------	----------------
Total Turnover	14,769,470	17,396,174	18,317,256	15,316,696	10,345,377
Costs of Goods Sold	(13,669,852)	(16,157,803)	(17,223,299)	(14,337,778)	(9,293,644)
	----------------	----------------	----------------	----------------	----------------
Gross Profit	1,099,618	1,238,371	1,093,957	978,918	1,051,733
	----------------	----------------	----------------	----------------	----------------

PROFIT/(LOSS) FROM OPERATIONS	42,953	126,388	63,944	121,851	96,259
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) BEFORE TAXATION	42,953	126,388	63,944	121,851	96,259
Taxation	(12,001)	(43,387)	(10,078)	(25,699)	(31,000)
	----------------	----------------	----------------	----------------	----------------
PROFIT/(LOSS) AFTER TAXATION	30,952	83,001	53,866	96,152	65,259
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) BROUGHT FORWARD
As previously reported	287,766	204,765	150,899	54,747	(10,512)
	----------------	----------------	----------------	----------------	----------------
As restated	287,766	204,765	150,899	54,747	(10,512)
	----------------	----------------	----------------	----------------	----------------
PROFIT AVAILABLE FOR APPROPRIATIONS	318,718	287,766	204,765	150,899	54,747
	----------------	----------------	----------------	----------------	----------------
RETAINED PROFIT/(LOSS) CARRIED FORWARD	318,718	287,766	204,765	150,899	54,747
	=============	=============	=============	=============	=============

INTEREST EXPENSE (as per notes to P&L)
Others	99,277	77,723	50,505	47,407	-
	----------------	----------------	----------------	----------------	----------------
	99,277	77,723	50,505	47,407	-
	=============	=============	=============	=============	-

DEPRECIATION (as per notes to P&L)	10,845	59,955	61,696	66,867	-
	----------------	----------------	----------------	----------------	----------------
	10,845	59,955	61,696	66,867	-
	=============	=============	=============	=============

BALANCE SHEET

ASSETS EMPLOYED:
FIXED ASSETS	2,820	13,665	67,922	127,071	193,938

Deferred assets	3,000	3,000	3,000	-	-
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM INVESTMENTS/OTHER ASSETS	3,000	3,000	3,000	-	-

	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM ASSETS	5,820	16,665	70,922	127,071	193,938

Stocks	-	316	2,337	23,575	5,765
Trade debtors	1,350,113	727,401	5,738,605	3,692,160	1,991,735
Other debtors, deposits & prepayments	1,423,706	3,501,031	3,542,478	994,676	431,449
Short term deposits	-	-	-	154,525	150,756
Amount due from director	-	5,162	-	-	-
Cash & bank balances	508,708	145,251	351,930	481,469	154,473
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT ASSETS	3,282,527	4,379,161	9,635,350	5,346,405	2,734,178
	----------------	----------------	----------------	----------------	----------------
TOTAL ASSET	3,288,347	4,395,826	9,706,272	5,473,476	2,928,116
	=============	=============	=============	=============	=============

CURRENT LIABILITIES
Trade creditors	463,944	1,690,557	3,216,981	1,577,678	281,323
Other creditors & accruals	1,768,933	1,598,394	5,504,171	2,893,082	1,693,893
Hire purchase & lease creditors	-	13,222	50,114	45,624	45,624
Amounts owing to director	109,408	231,013	145,736	313,236	316,777
Provision for taxation	27,344	54,344	50,752	47,837	37,000
	----------------	----------------	----------------	----------------	----------------
TOTAL CURRENT LIABILITIES	2,369,629	3,587,530	8,967,754	4,877,457	2,374,617
	----------------	----------------	----------------	----------------	----------------
NET CURRENT ASSETS/(LIABILITIES)	912,898	791,631	667,596	468,948	359,561
	----------------	----------------	----------------	----------------	----------------
TOTAL NET ASSETS	918,718	808,296	738,518	596,019	553,499
	=============	=============	=============	=============	=============

SHARE CAPITAL
Ordinary share capital	600,000	500,000	500,000	350,003	350,003
	----------------	----------------	----------------	----------------	----------------
TOTAL SHARE CAPITAL	600,000	500,000	500,000	350,003	350,003

Retained profit/(loss) carried forward	318,718	287,766	204,765	150,899	54,747
	----------------	----------------	----------------	----------------	----------------
TOTAL RESERVES	318,718	287,766	204,765	150,899	54,747

	----------------	----------------	----------------	----------------	----------------
SHAREHOLDERS' FUNDS/EQUITY	918,718	787,766	704,765	500,902	404,750

Lease obligations	-	20,530	33,753	86,117	131,749
Deferred taxation	-	-	-	9,000	17,000
	----------------	----------------	----------------	----------------	----------------
TOTAL LONG TERM LIABILITIES	-	20,530	33,753	95,117	148,749
	----------------	----------------	----------------	----------------	----------------
	918,718	808,296	738,518	596,019	553,499
	=============	=============	=============	=============	=============

FINANCIAL RATIO

TYPES OF FUNDS
Cash	508,708	145,251	351,930	635,994	305,229
Net Liquid Funds	508,708	145,251	351,930	635,994	305,229
Net Liquid Assets	912,898	791,315	665,259	445,373	353,796
Net Current Assets/(Liabilities)	912,898	791,631	667,596	468,948	359,561
Net Tangible Assets	918,718	808,296	738,518	596,019	553,499
Net Monetary Assets	912,898	770,785	631,506	350,256	205,047
PROFIT & LOSS ITEMS
Earnings Before Interest & Tax (EBIT)	142,230	204,111	114,449	169,258	96,259
Earnings Before Interest, Taxes, Depreciation And Amortization (EBITDA)	153,075	264,066	176,145	236,125	96,259
BALANCE SHEET ITEMS
Total Borrowings	0	33,752	83,867	131,741	177,373
Total Liabilities	2,369,629	3,608,060	9,001,507	4,972,574	2,523,366
Total Assets	3,288,347	4,395,826	9,706,272	5,473,476	2,928,116
Net Assets	918,718	808,296	738,518	596,019	553,499
Net Assets Backing	918,718	787,766	704,765	500,902	404,750
Shareholders' Funds	918,718	787,766	704,765	500,902	404,750
Total Share Capital	600,000	500,000	500,000	350,003	350,003
Total Reserves	318,718	287,766	204,765	150,899	54,747
LIQUIDITY (Times)
Cash Ratio	0.21	0.04	0.04	0.13	0.13
Liquid Ratio	1.39	1.22	1.07	1.09	1.15
Current Ratio	1.39	1.22	1.07	1.10	1.15
WORKING CAPITAL CONTROL (Days)
Stock Ratio	0	0	0	1	0
Debtors Ratio	33	15	114	88	70
Creditors Ratio	12	38	68	40	11
SOLVENCY RATIOS (Times)
Gearing Ratio	0	0.04	0.12	0.26	0.44
Liabilities Ratio	2.58	4.58	12.77	9.93	6.23
Times Interest Earned Ratio	1.43	2.63	2.27	3.57	0
Assets Backing Ratio	1.53	1.62	1.48	1.70	1.58
PERFORMANCE RATIO (%)
Operating Profit Margin	0.29	0.73	0.35	0.80	0.93
Net Profit Margin	0.21	0.48	0.29	0.63	0.63
Return On Net Assets	15.48	25.25	15.50	28.40	17.39
Return On Capital Employed	15.48	24.85	14.51	26.38	16.07
Return On Shareholders' Funds/Equity	3.37	10.54	7.64	19.20	16.12
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.66.39
UK Pound	1	Rs.102.59
Euro	1	Rs.74.90

INFORMATION DETAILS

Analysis Done by :	KAR

Report Prepared by :	NIT

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%)

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