MIRA INFORM REPORT

Report No. :	506288
Report Date :	30.04.2018

IDENTIFICATION DETAILS

Name :	MANGHARAMS (THAILAND) LIMITED

Registered Office :	Unit 11d, 11^th Floor, Richmond Building, 75/26 Soi Sukhumvit 26, Sukhumvit Road, Klongton, Klongtoey, Bangkok 10110

Country :	Thailand

Financials (as on) :	31.12.2016

Date of Incorporation :	05.01.1989

Com. Reg. No.:	0105532001137

Legal Form :	Private Limited Company

Line of Business :	The subject is engaged in exporting various kinds of garment for men, women and children, such as ladies blouses, skirt, dress, suit, jeans, T-shirt, shirts, shorts, slacks, cardigan and etc., under its own brand “JACQUES VALMONT”, as well as providing commission service for manufacturing the products under customer’s brands such as “TOMMY HIFIGER”, “THE GAP”, “ALFRED SUNG”, “VAN HEUSEN”, “FEDERATED”, “JOHN HENRY” and etc.

No. of Employees :	42

RATING & COMMENTS

(Mira Inform has adopted New Rating mechanism w.e.f. 23^rd January 2017)

MIRA’s Rating :

Credit Rating

Explanation

Rating Comments

Acceptable Risk

Business dealings permissible with moderate risk of default

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

Country Name

Previous Rating

(30.09.2017)

Current Rating

(31.12.2017)

Thailand

Risk Category	ECGC Classification
Insignificant	A1
Low Risk	A2
Moderately Low Risk	B1
Moderate Risk	B2
Moderately High Risk	C1
High Risk	C2
Very High Risk	D

THAILAND - ECONOMIC OVERVIEW

With a relatively well-developed infrastructure, a free-enterprise economy, and generally pro-investment policies, Thailand is highly dependent on international trade, with exports accounting for about two-thirds of GDP. Thailand’s exports include electronics, agricultural commodities, automobiles and parts, and processed foods. The industry and service sectors produce about 90% of GDP. The agricultural sector, comprised mostly of small-scale farms, contributes only 10% of GDP but employs about one-third of the labor force. Thailand has attracted an estimated 3.0-4.5 million migrant workers, mostly from neighboring countries.

Over the last few decades, Thailand has reduced poverty substantially. In 2013, the Thai Government implemented a nationwide 300 baht (roughly $10) per day minimum wage policy and deployed new tax reforms designed to lower rates on middle-income earners.

Thailand’s economy is recovering from slow growth during the years since the 2014 coup. Thailand’s economic fundamentals are sound, with low inflation, low unemployment, and reasonable public and external debt levels. Tourism and government spending - mostly on infrastructure and short-term stimulus measures – have helped to boost the economy, and The Bank of Thailand has been supportive, with several interest rate reductions.

Over the longer-term, household debt levels, political uncertainty, and an aging population pose risks to growth.

Source : CIA

Company name

MANGHARAMS (THAILAND) LIMITED

SUMMARY

BUSINESS ADDRESS : UNIT 11D, 11^TH FLOOR, RICHMOND BUILDING,

75/26 SOI SUKHUMVIT 26, SUKHUMVIT ROAD,

KLONGTON, KLONGTOEY, BANGKOK 10110,

THAILAND

TELEPHONE : [66] 2258-0823-8

FAX : [66] 2258-0829

E-MAIL ADDRESS : info@mangharams.net

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 1989

REGISTRATION NO. : 0105532001137

TAX ID NO. : 3101585773

CAPITAL REGISTERED : BHT. 10,000,000

CAPITAL PAID-UP : BHT. 10,000,000

SHAREHOLDER’S PROPORTION : THAI : 81.90%

FOREIGN : 18.10%

FISCAL YEAR CLOSING DATE : DECEMBER 31

LEGAL STATUS : PRIVATE LIMITED COMPANY

EXECUTIVE : MR. DINESH RATTAN MANGHARAM, CHINESE

MANAGING DIRECTOR

NO. OF STAFF : 42

LINES OF BUSINESS : GARMENT

EXPORTER AND SERVICE PROVIDER

CORPORATE PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : FAIR WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH FAIR PERFORMANCE

HISTORY

The subject was established on January 5, 1989 as a private limited company under the registered name MANGHARAMS (THAILAND) LIMITED, by Thai and foreign groups, in order to export garment to overseas customers. It currently employs 42 staff.

The subject’s registered address was initially located at 1/50-51 Sukhumvit Soi Sukhumvit 39, Sukhumvit Road, Klongtonnua, Wattana, Bangkok 10110.

On July 25, 2016, the registered address was relocated to Unit 11D, 11^th Floor,

Richmond Building, 75/26 Soi Sukhumvit 26, Sukhumvit Road, Klongton, Klongtoey,

Bangkok 10110, and this is the subject’s current operation address.

THE BOARD OF DIRECTOR

Name	Nationality	Age

Mr. Dinesh Rattan Mangharam	Chinese	52
Mr. Gobindram Naraindas Samtani	Indian	88

AUTHORIZED PERSON

One of the above directors can sign on behalf of the subject with company’s affixed.

MANAGEMENT

Mr. Dinesh Rattan Mangharam is the Managing Director.

He is Chinese nationality with the age of 52 years old.

BUSINESS OPERATIONS

The subject is engaged in exporting various kinds of garment for men, women and children, such as ladies blouses, skirt, dress, suit, jeans, T-shirt, shirts, shorts, slacks, cardigan and etc., under its own brand “JACQUES VALMONT”, as well as providing commission service for manufacturing the products under customer’s brands such as “TOMMY HIFIGER”, “THE GAP”, “ALFRED SUNG”, “VAN HEUSEN”,

“FEDERATED”, “JOHN HENRY” and etc.

The subject hires local manufacturer for the production.

PURCHASE

Raw material mainly fabric is purchased from suppliers and agents in both domestic

and overseas, such as Vietnam, Hong Kong, Cambodia, Bangladesh and

Republic of China.

EXPORT

100% of the products is exported to U.S.A., Hong Kong, Canada, Mexico, India, Peru and the country in Europe and Middle East.

SUBSIDIARY AND AFFILIATED COMPANY

The subject is not found to have any subsidiary or affiliated company here in Thailand.

LITIGATION

Bankruptcy and Receivership

There are no litigation on bankruptcy and receivership cases filed against the subject found at Legal Execution Department for the past five years.

Others

There are no legal suits filed against the subject according to the past two years.

CREDIT

Local bills are paid by cash or on the credits term of 30-60 days.

Imports are by T/T.

Exports are against T/T.

BANKING

Bangkok Bank Public Company Limited

EMPLOYMENT

The subject employs 42 staff.

LOCATION DETAILS

The premise is rented for administrative office at the heading address. Premise is located in commercial/residential area.

COMMENT

The subject was formed in 1989 as an exporter and commission agent for

manufacturing world leading brands garment such as JACQUES VALMONT, TOMMY

HIFIGER, THE GAP, ALFRED SUNG and etc. Subject has served its clients at its

best for twenty-nine years.

Its operating performance in 2016 has seen an improvement with an increase in both sales or service income and net profit comparing to the previous year. The increase in sales figures was from effective market expansion in overseas countries in the past year.

Generally, the subject maintains a moderate business.

FINANCIAL INFORMATION

The capital was registered at Bht. 3,000,000 divided into 30,000 shares of

Bht. 100 each.

The capital was increased later as following:

Bht. 6,000,000 on March 2, 1994

Bht. 8,000,000 on January 14, 1997

Bht. 9,000,000 on February 7, 2008

Bht. 10,000,000 on June 23, 2009

The latest registered capital was increased to Bht. 10,000,000 divided into 100,000 shares of Bht. 100 each with fully paid.

THE SHAREHOLDERS LISTED WERE : [as at March 20, 2017]

NAME	HOLDING	%

Mr. Arthit Mangharam Nationality: Thai Address : 32/60 Soi Sukhumvit 26, Sukhumvit Road, Klongton, Klongtoey, Bangkok	27,300	27.30
Ms. Annavee Mangharam Nationality: Thai Address : 32/60 Soi Sukhumvit 26, Sukhumvit Road, Klongton, Klongtoey, Bangkok	27,300	27.30
Mr. Alekhya Mangharam Nationality: Thai Address : 32/60 Soi Sukhumvit 26, Sukhumvit Road, Klongton, Klongtoey, Bangkok	27,300	27.30
Mr. Gobindram Naraindas Samtani Nationality: Indian Address : 7^th Floor, Cosmos Building, 8-11 Lan Kwai Fong, Central, Hong Kong	9,700	9.70

Mr. Dinesh Rattan Mangharam

Nationality: Chinese

Address : 32/60 Soi Sukhumvit 26, Sukhumvit Road,

Klongton, Klongtoey, Bangkok

8,400

8.40

Total Shareholders : 5

Share Structure [as at March 20, 2017]

Nationality	Shareholders	No. of Share	% Shares

Thai	3	81,900	81.90
Foreign	2	18,100	18.10
Total	5	100,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO. :

Ms. Wanna Khemphet No. 9471

BALANCE SHEET [BAHT]

The latest financial figures published for December 31, 2016, 2015 and 2014 were:

ASSETS

Current Assets	2016	2015	2014

Cash and Cash Equivalents	776,497.25	39,188.16	1,069,410.29
Trade Accounts and Other Receivable	16,666,380.54	4,996,411.49	13,640,239.29
Short-term Loans	72,495,441.63	26,915,081.27	23,220,553.32
Inventories	49,213,990.78	109,731,473.22	105,420,492.73
Other Current Assets	13,060,401.41	8,097,643.48	11,396,446.89
Total Current Assets	152,212,711.61	149,779,797.62	154,797,142.52

Property, Plant and Equipment	12,773,318.35	14,875,802.56	16,291,961.13
Other Non-current Assets	9,493,509.00	8,987,985.06	8,747,397.67
Total Assets	174,479,538.96	173,643,585.24	179,836,501.32

LIABILITIES & SHAREHOLDERS' EQUITY [BAHT]

Current Liabilities	2016	2015	2014

Bank Overdraft and Short-term Loan From Financial Institutions	77,686,902.79	70,597,198.20	74,390,295.80
Trade Accounts and Other Payable	44,314,420.65	51,150,062.90	55,800,205.71
Current Portion of Long-term Liabilities	128,154.98	246,937.10	234,750.00
Short-term Loans	16,708,732.64	16,043,764.18	12,293,175.60
Accrued Income Tax	253,603.53	62,982.39	497,644.37
Other Current Liabilities	6,198,062.35	8,085,162.97	9,136,840.97
Total Current Liabilities	145,289,876.94	146,186,107.74	152,352,912.45

Long-term Loan	-	128,985.49	-
Provision for Employee Benefits	895,668.08	724,346.46	696,629.31
Other Non-current Liabilities	-	-	377,550.40
Total Liabilities	146,185,545.02	147,039,439.69	153,427,092.16

Shareholders’ Equity

Share capital : Baht 100 par value authorized, and issued share capital 100,000 shares	10,000,000.00	10,000,000.00	10,000,000.00
Capital Paid	10,000,000.00	10,000,000.00	10,000,000.00
Retained Earning -Unappropriated [Deficit]	18,293,993.94	16,604,145.55	16,409,409.16
Total Shareholders’ Equity	28,293,993.94	26,604,145.55	26,409,409.16
Total Liabilities and Shareholders’ Equity	174,479,538.96	173,643,585.24	179,836,501.32

PROFIT & LOSS ACCOUNT

Revenue	2016	2015	2014

Sales or Services Income	257,646,939.52	141,739,608.88	226,812,648.37
Other Income	4,533,454.04	3,951,201.98	2,014,255.21
Total Revenues	262,180,393.56	145,690,810.86	228,826,903.58
Expenses

Cost of Goods Sold or Services	221,668,963.99	103,689,876.27	181,073,051.31
Selling Expenses	2,587,004.82	5,553,467.01	1,610,338.94
Administrative Expenses	30,262,006.64	28,706,397.00	35,859,575.38
Total Expenses	254,517,975.45	137,949,740.28	218,542,965.63

Profit /[Loss] before Financial Cost and Income Tax	7,662,418.11	7,741,070.58	10,283,937.95
Financial Cost	[5,470,093.81]	[7,097,251.69]	[6,509,064.79]

Profit /[Loss] before Income Tax	2,192,324.30	643,818.89	3,774,873.16
Income Tax	[502,475.91]	[449,082.50]	[922,124.85]
Net Profit / [Loss]	1,689,848.39	194,736.39	2,852,748.31

FINANCIAL ANALYSIS

ITEM	UNIT	2016	2015	2014

LIQUIDITY RATIO
CURRENT RATIO	TIMES	1.05	1.02	1.02
QUICK RATIO	TIMES	0.62	0.22	0.25

ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	20.17	9.53	13.92
TOTAL ASSETS TURNOVER	TIMES	1.48	0.82	1.26
INVENTORY CONVERSION PERIOD	DAYS	81.04	386.27	212.50
INVENTORY TURNOVER	TIMES	4.50	0.94	1.72
RECEIVABLES CONVERSION PERIOD	DAYS	23.61	12.87	21.95
RECEIVABLES TURNOVER	TIMES	15.46	28.37	16.63
PAYABLES CONVERSION PERIOD	DAYS	72.97	180.05	112.48
CASH CONVERSION CYCLE	DAYS	31.68	219.08	121.97

PROFITABILITY RATIO
COST OF GOODS SOLD	%	86.04	73.16	79.83
SELLING & ADMINISTRATION	%	12.75	24.17	16.52
INTEREST	%	2.12	5.01	2.87
GROSS PROFIT MARGIN	%	15.72	29.63	21.05
NET PROFIT MARGIN BEFORE EX. ITEM	%	2.97	5.46	4.53
NET PROFIT MARGIN	%	0.66	0.14	1.26
RETURN ON EQUITY	%	5.97	0.73	10.80
RETURN ON ASSET	%	0.97	0.11	1.59
EARNING PER SHARE	BAHT	16.90	1.95	28.53

LEVERAGE RATIO
DEBT RATIO	TIMES	0.84	0.85	0.85
DEBT TO EQUITY RATIO	TIMES	5.17	5.53	5.81
TIME INTEREST EARNED	TIMES	1.40	1.09	1.58

ANNUAL GROWTH
SALES GROWTH	%	81.77	(37.51)
OPERATING PROFIT	%	(1.02)	(24.73)
NET PROFIT	%	767.76	(93.17)
FIXED ASSETS	%	(14.13)	(8.69)
TOTAL ASSETS	%	0.48	(3.44)

ANNUAL GROWTH : SATISFACTORY

An annual sales growth is 81.77%. Turnover has increased from THB 141,739,608.88 in 2015 to THB 257,646,939.52 in 2016. While net profit has increased from THB 194,736.39 in 2015 to THB 1,689,848.39 in 2016. And total assets has increased from THB 173,643,585.24 in 2015 to THB 174,479,538.96 in 2016.

PROFITABILITY : ACCEPTABLE

PROFITABILITY RATIO

Gross Profit Margin	15.72	Acceptable	Industrial Average	31.71
Net Profit Margin	0.66	Acceptable	Industrial Average	2.24
Return on Assets	0.97	Acceptable	Industrial Average	2.93
Return on Equity	5.97	Satisfactory	Industrial Average	9.84

Gross Profit Margin used to assess a firm's financial health by revealing the proportion of money left over from revenues after accounting for the cost of goods sold. Gross profit margin serves as the source for paying additional expenses and future savings. The company's figure is 15.72%. When compared with the industry average, the ratio of the company was lower. This indicated that company may have problems with control over its costs.

Net Profit Margin is the indicator of the company's efficiency in that net profit takes into consideration all expenses of the company. A low profit margin indicates a low margin of safety, higher risk that a decline in sales will erase profits and result in a net loss. The company's figure is 0.66%. When compared with the industry average, the ratio of the company was lower.

Return on Assets measures how efficiently profits are being generated from the assets employed in the business when compared with the ratios of firms in a similar business. A low ratio in comparison with industry averages indicates an inefficient use of business assets. When compared with the industry average, it was lower, the company's figure is 0.97%.

Return on Equity indicates how profitable a company is by comparing its net income to its average shareholders' equity, ROE measures how much the shareholders earned for their investment in the company. When compared with the industry average, it was lower, the company's figure is 5.97%.

Trend of the average competitors in the same industry for last 5 years

Return on Assets Uptrend

Return on Equity Uptrend

LIQUIDITY : ACCEPTABLE

LIQUIDITY RATIO

Current Ratio	1.05	Satisfactory	Industrial Average	1.45
Quick Ratio	0.62
Cash Conversion Cycle	31.68

The Current Ratio is to ascertain whether a company's short-term assets are readily available to pay off its short-term liabilities. The company's figure is 1.05 times in 2016, increase from 1.02 times, then it is generally considered to have good short-term financial strength. When compared with the industry average, the ratio of the company was lower.

The Quick Ratio is a liquidity indicator that further refines the current ratio by measuring the amount of the most liquid current assets there are to cover current liabilities. The company's figure is 0.62 times in 2016, increase from 0.22 times, then the company has not enough current assets that presumably can be quickly converted to cash for pay financial obligations.

The Cash Conversion Cycle measures the number of days a company's cash is tied up in the production and sales process of its operations and the benefit from payment terms from its creditors. It meant the company could survive when no cash inflow was received from sale for 32 days.

Trend of the average competitors in the same industry for last 5 years

Current Ratio Uptrend

LEVERAGE : ACCEPTABLE

LEVERAGE RATIO

Debt Ratio	0.84	Acceptable	Industrial Average	0.68
Debt to Equity Ratio	5.17	Risky	Industrial Average	2.10
Times Interest Earned	1.40	Impressive	Industrial Average	-

Debt to Equity Ratio a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed. A higher the percentage means that the company is using less equity and has stronger leverage position.

Times Interest Earned measuring a company's ability to meet its debt obligations. Ratio is 1.41 higher than 1, so the company can pay interest expenses on outstanding debt.

Debt Ratio shows the proportion of a company's assets which are financed through debt. The company's figure is 0.84 greater than 0.5, most of the company's assets are financed through debt.

Trend of the average competitors in the same industry for last 5 years

Debt Ratio Downtrend

Times Interest Earned Stable

ACTIVITY : EXCELLENT

ACTIVITY RATIO

Fixed Assets Turnover	20.17	Impressive	Industrial Average	-
Total Assets Turnover	1.48	Impressive	Industrial Average	1.31
Inventory Conversion Period	81.04
Inventory Turnover	4.50	Impressive	Industrial Average	2.66
Receivables Conversion Period	23.61
Receivables Turnover	15.46	Impressive	Industrial Average	3.52
Payables Conversion Period	72.97

The company's Account Receivable Ratio is calculated as 15.46 and 28.37 in 2016 and 2015 respectively. This ratio measures the efficiency of the company in managing its trade debtors to generate revenue. A lower ratio may indicate over extension and collection problems. Conversely, a higher ratio may indicate an overtly stringent policy. In this case, the company's A/R ratio in 2016 decreased from 2015. This would suggest the company had deteriorated in the management of its debt collections.

Inventory Turnover in Days Ratio indicates the liquidity of inventory. It estimates the number of days that it will take to sell the current inventory. Inventory is particularly sensitive to change in business activities. The inventory turnover in days has decreased from 386 days at the end of 2015 to 81 days at the end of 2016. This represents a positive trend. And Inventory turnover has increased from 0.94 times in year 2015 to 4.5 times in year 2016.

The company's Total Asset Turnover is calculated as 1.48 times and 0.82 times in 2016 and 2015 respectively. This ratio is determined by dividing total assets into total sales turnover. The ratio measures the activity of the assets and the ability of the firm to generate sales through the use of the assets.

Trend of the average competitors in the same industry for last 5 years

Fixed Assets Turnover Stable

Total Assets Turnover Uptrend

Inventory Turnover Uptrend

Receivables Turnover Uptrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 66.78
UK Pound	1	INR 92.89
Euro	1	INR 80.74
Thai Baht	1	INR 2.11

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

INFORMATION DETAILS

Analysis Done by :	VIV

Report Prepared by :	TPT

RATING EXPLANATIONS

Credit Rating	Explanation	Rating Comments
A++	Minimum Risk	Business dealings permissible with minimum risk of default
A+	Low Risk	Business dealings permissible with low risk of default
A	Acceptable Risk	Business dealings permissible with moderate risk of default
B	Medium Risk	Business dealings permissible on a regular monitoring basis
C	Medium High Risk	Business dealings permissible preferably on secured basis
D	High Risk	Business dealing not recommended or on secured terms only
NB	New Business	No recommendation can be done due to business in infancy stage
NT	No Trace	No recommendation can be done as the business is not traceable

NB is stated where there is insufficient information to facilitate rating. However, it is not to be considered as unfavourable.

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 are as follows:

· Financial condition covering various ratios

· Company background and operations size

· Promoters / Management background

· Payment record

· Litigation against the subject

· Industry scenario / competitor analysis

· Supplier / Customer / Banker review (wherever available)

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