3decades

MIRA INFORM REPORT

Report No. :	485812
Report Date :	12.01.2018

IDENTIFICATION DETAILS

Name :	INEOS STYROLUTION (THAILAND) CO., LTD

Formerly Known As :	STYROLUTION (THAILAND) CO., LTD

Registered Office :	4/2 I-8 Road, Mab Ta Phut Industrial Estate, T. Mab Ta Phut, A. Muang, Rayong 21150

Country :	Thailand

Financials (as on) :	31.12.2016

Date of Incorporation :	26.02.2004

Com. Reg. No.:	0215547000670 [Former: 0217354700674]

Legal Form :	Private Limited Company

Line of Business :	The subject is engaged in manufacturing and marketing wide range of plastic resin for automobile parts, electronic parts, household products and packaging industry.

No. of Employees :	400

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 :	Good

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

(30.06.2017)

Current Rating

(30.09.2017)

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 sustained strong growth and 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.

Growth has slowed in the last few years, however, due to domestic political turmoil and sluggish global demand. Nevertheless, 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, Thailand faces labor shortages, and domestic debt levels, political uncertainty, and an aging population pose risks to growth.

Source : CIA

Company name

INEOS STYROLUTION (THAILAND) CO., LTD

[FORMER: STYROLUTION (THAILAND) CO., LTD]

SUMMARY

BUSINESS ADDRESS : 4/2 I-8 ROAD, MAB TA PHUT INDUSTRIAL

ESTATE, T. MAB TA PHUT, A. MUANG, RAYONG 21150, THAILAND

TELEPHONE : [66] 38 910-700, 38 910-981

FAX : [66] 38 910-777

E-MAIL ADDRESS : vichai.sakulbongkoch@lustran-polymers.com

REGISTRATION ADDRESS : SAME AS BUSINESS ADDRESS

ESTABLISHED : 2004

REGISTRATION NO. : 0215547000670 [Former: 0217354700674]

TAX ID NO. : 3031319783

CAPITAL REGISTERED : BHT. 470,000,000

CAPITAL PAID-UP : BHT. 470,000,000

SHAREHOLDER’S PROPORTION : FOREIGN : 100%

FISCAL YEAR CLOSING DATE : DECEMBER 31

LEGAL STATUS : PRIVATE LIMITED COMPANY

MANAGEMENT : MR. PHON WONGRIANTHONG, THAI

MANAGING DIRECTOR

NO. OF STAFF : 400

LINES OF BUSINESS : PLASTIC RESIN

MANUFACTURER, DISTRIBUTOR AND EXPORTER

CORPORATE PROFILE

OPERATING TREND : STABLE

PRESENT SITUATION : OPERATING NORMALLY

REPUTATION : GOOD WITH NORMAL BUSINESS ENGAGEMENT

MANAGEMENT STANDARD : MANAGEMENT WITH FAIR PERFORMANCE

HISTORY

The subject was established on February 26, 2004 as a private limited company under the registered name “Styrenics (Thailand) Ltd.”, by German groups, to manufacture and market wide range of plastic resin to both domestic and international markets.

On March 25, 2004, the subject’s name was changed to “Lanxess (Thailand) Ltd.”, and changed to “Ineos ABS (Thailand) Co., Ltd.”, on October 1, 2007.

In 2011, there was a joint venture between BASF, in Germany and INEOS Industries Holdings Limited, in U.K, then the subject’s name was changed to “Styrolution (Thailand) Co., Ltd.” on October 3, 2011, and was finally changed to INEOS STYROLUTION (THAILAND) CO., LTD., on January 15, 2016. It currently employs approximately 400 staff.

Subject is currently a wholly owned subsidiary of Ineos Styrolution Group GmbH, Germany.

The subject’s registered address is 4/2 I-8 Rd., Mab Ta Phut Industrial Estate,

T. Mab Ta Phut, A. Muang, Rayong 21150, and this is the subject’s current operation address.

THE BOARD OF DIRECTORS

Name	Nationality	Age

Mr. Phon Wongrianthong	Thai	48
Mr. Stephen Mark Harrington	British	50
Mr. Tan Jit Teng	Malaysian	49

AUTHORIZED PERSON

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

MANAGEMENT

Mr. Phon Wongrianthong is the Managing Director.

He is Thai nationality with the age of 48 years old.

Mr. Stephen Mark Harrington is the Deputy Managing Director / Sales &

Marketing Manager.

He is British nationality with the age of 50 years old.

BUSINESS OPERATIONS

The subject is engaged in manufacturing and marketing wide range of plastic resin for automobile parts, electronic parts, household products and packaging industry. Its products are as follows:

ABS [made from acrylonitrile, butadiene and styrene]

SAN [a product for injection molding application based on styrene and acrylonitrile].

BRAND NAMES

“LUSTRAN”, “TRIAX”, “NOVODUR”

PRODUCTION CAPACITY

120,000 tons per annum

PURCHASE

Raw materials such as plastic resin and chemicals are purchased from suppliers and agents both domestic and overseas, mainly in Germany, Japan, United Kingdom, Singapore, Republic of China, India and Taiwan.

MAJOR SUPPLIERS

BASF (Thai) Co., Ltd. : Thailand

Ineos Styrolution Group GmbH. : Germany

Thai-MC Company Limited : Thailand

SALES

80% of the products is exported to Africa, Republic of China, Japan, Taiwan, Korea, Australia, Germany, Brazil, Argentina, U.S.A., India, Singapore, Hong Kong, Vietnam, United Kingdom, France, Malaysia, Indonesia, Myanmar, Pakistan and Philippines, and the remaining 20% is sold locally to manufacturers, wholesalers and end-users.

MAJOR CUSTOMERS

Eastern Polymer Industry Co., Ltd. : Thailand

Thai Polymer Supply Co., Ltd. : Thailand

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 for the past two years.

CREDIT

Sales are by cash or on the credits term of 30-60 days.

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

Imports are by L/C at sight or T/T.

Exports are against T/T.

BANKING

Bangkok Bank Public Company Limited

Kasikornbank Public Company Limited

EMPLOYMENT

The subject employs approximately 400 office staff and factory workers.

LOCATION DETAILS

The premise is rented for administrative office, factory and warehouse at the heading address. Premise is located in industrial area.

Bangkok Sales Office:

Unit 25/A2, 25^th Floor, Silom Complex Building, 191 Silom Rd., Bangrak,

Bangkok 10500. Tel.: [66] 2632-1953-6, Fax [66] 2632-1952.

COMMENT

The subject is a manufacturer, distributor and exporter of plastic resin for various industries. The subject’s business performance in 2016 was moderate despite of a decrease in both sales or service income and net profit comparing to the previous year, its business remains profitable. Without any distinctive sign of improvement or growth from related industries or economy, the unfavorable factors would remain and could more or less have a pressure on the subject’s growth this year.

FINANCIAL INFORMATION

The capital was initially registered at Bht. 300,000,000 divided into 300,000 shares of Bht. 1,000 each.

On July 5, 2004, the capital was increased to Bht. 470,000,000 divided into 470,000 shares of Bht. 1,000 each with fully paid.

THE SHAREHOLDERS LISTED WERE : [as at April 10, 2017]

NAME	HOLDING	%

Ineos Styrolution Group GmbH. Nationality: German Address : Erlenstraße 2 60325 Frankfurt, Germany	469,994	100.00
Ineos Styrolution APAC Pte. Ltd. Nationality: Singaporean Address : #08-01/02 Triple One Building, 111 Somerset Road, Somerset, Singapore	3	-
Ineos Styrolution Hong Kong Company Limited Nationality: Hong Kong Address : 132 Nathan Road, Chim Cha Chui, Hong Kong	3	-

Total Shareholders : 3

Share Structure : [as at April 10, 2017]

Nationality	Shareholders	No. of Share	% Shares

Thai	-	-	-
Foreign	3	470,000	100.00
Total	3	470,000	100.00

NAME OF AUDITOR & CERTIFIED PUBLIC ACCOUNTANT NO.

Mr. Pisit Tangtanakul No. 4095

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	157,370,502	347,119,084	544,819,700
Trade Accounts and Other Receivable	699,257,341	585,585,909	704,860,369
Inventories	891,991,266	446,854,682	594,031,248
Other Current Assets	31,956,597	24,844,934	37,498,636
Total Current Assets	1,780,575,706	1,404,404,609	1,881,209,953
Property, Plant and Equipment	1,544,997,225	1,276,559,833	682,173,616
Intangible Assets	14,729,588	3,377,783	1,354,099
Other Non-current Assets	3,718,700	2,192,885	1,566,538
Total Assets	3,344,021,219	2,686,535,110	2,566,304,206

LIABILITIES & SHAREHOLDERS' EQUITY [BAHT]

Current Liabilities	2016	2015	2014

Trade Accounts and Other Payable	744,799,955	620,842,804	840,074,542
Accrued Income Tax	46,243,412	22,220,937	6,899,692
Total Current Liabilities	791,043,367	643,063,741	846,974,234

Long-term Loan	1,124,022,500	800,000,000	800,000,000
Employee Benefit Obligation	129,465,202	61,411,322	57,101,182
Estimated Long-term Liabilities	28,899,105	28,899,105	27,232,478
Total Liabilities	2,073,430,174	1,533,374,168	1,731,307,894

Shareholders' Equity

Share capital : Baht 1,000 par value authorized, issued and fully paid share capital 470,000 shares	470,000,000	470,000,000	470,000,000
Capital Paid	470,000,000	470,000,000	470,000,000
Retained Earning - Unappropriated [Deficit]	800,591,045	683,160,942	364,996,312
Total Shareholders' Equity	1,270,591,045	1,153,160,942	834,996,312
Total Liabilities and Shareholders' Equity	3,344,021,219	2,686,535,110	2,566,304,206

PROFIT & LOSS ACCOUNT

Revenue	2016	2015	2014

Sales or Services Income	5,134,025,147	5,431,445,867	7,369,928,848
Other Income	51,085,249	103,377,657	91,566,437
Total Revenues	5,185,110,396	5,534,823,524	7,461,495,285
Expenses

Cost of Goods Sold or Services	4,520,522,868	4,768,759,522	6,725,350,261
Selling Expense	238,197,198	230,031,440	247,172,134
Administrative Expenses	166,802,494	149,798,308	162,218,713
Total Expenses	4,925,522,560	5,148,589,270	7,134,741,108
Profit/ [Loss] before Financial Cost & Income Tax	259,587,836	386,234,254	326,754,177
Financial Cost	[69,645,671]	[29,444,806]	[23,609,586]

Profit/ [Loss] before Income Tax	189,942,165	356,789,448	303,144,591
Income Tax	[72,512,062]	[38,624,818]	[7,540,255]
Net Profit / [Loss]	117,430,103	318,164,630	295,604,336

FINANCIAL ANALYSIS

ITEM	UNIT	2016	2015	2014

LIQUIDITY RATIO
CURRENT RATIO	TIMES	2.25	2.18	2.22
QUICK RATIO	TIMES	1.08	1.45	1.48

ACTIVITY RATIO
FIXED ASSETS TURNOVER	TIMES	3.32	4.25	10.80
TOTAL ASSETS TURNOVER	TIMES	1.54	2.02	2.87
INVENTORY CONVERSION PERIOD	DAYS	72.02	34.20	32.24
INVENTORY TURNOVER	TIMES	5.07	10.67	11.32
RECEIVABLES CONVERSION PERIOD	DAYS	49.71	39.35	34.91
RECEIVABLES TURNOVER	TIMES	7.34	9.28	10.46
PAYABLES CONVERSION PERIOD	DAYS	60.14	47.52	45.59
CASH CONVERSION CYCLE	DAYS	61.60	26.04	21.56

PROFITABILITY RATIO
COST OF GOODS SOLD	%	88.05	87.80	91.25
SELLING & ADMINISTRATION	%	3.25	2.76	2.20
INTEREST	%	1.36	0.54	0.32
GROSS PROFIT MARGIN	%	12.94	14.10	9.99
NET PROFIT MARGIN BEFORE EX. ITEM	%	5.06	7.11	4.43
NET PROFIT MARGIN	%	2.29	5.86	4.01
RETURN ON EQUITY	%	9.24	27.59	35.40
RETURN ON ASSET	%	3.51	11.84	11.52
EARNING PER SHARE	BAHT	249.85	676.95	628.95

LEVERAGE RATIO
DEBT RATIO	TIMES	0.62	0.57	0.67
DEBT TO EQUITY RATIO	TIMES	1.63	1.33	2.07
TIME INTEREST EARNED	TIMES	3.73	13.12	13.84

ANNUAL GROWTH
SALES GROWTH	%	(5.48)	(26.30)
OPERATING PROFIT	%	(32.79)	18.20
NET PROFIT	%	(63.09)	7.63
FIXED ASSETS	%	21.03	87.13
TOTAL ASSETS	%	24.47	4.68

ANNUAL GROWTH : ACCEPTABLE

An annual sales growth is -5.48%. Turnover has decreased from THB 5,431,445,867.00 in 2015 to THB 5,134,025,147.00 in 2016. While net profit has decreased from THB 318,164,630.00 in 2015 to THB 117,430,103.00 in 2016. And total assets has increased from THB 2,686,535,110.00 in 2015 to THB 3,344,021,219.00 in 2016.

PROFITABILITY : ACCEPTABLE

PROFITABILITY RATIO

Gross Profit Margin	12.94	Satisfactory	Industrial Average	21.84
Net Profit Margin	2.29	Deteriorated	Industrial Average	13.73
Return on Assets	3.51	Deteriorated	Industrial Average	17.18
Return on Equity	9.24	Acceptable	Industrial Average	30.88

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 12.94%. 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 2.29%. 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 3.51%.

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 9.24%.

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

Return on Assets Uptrend

Return on Equity Uptrend

LIQUIDITY : SATISFACTORY

LIQUIDITY RATIO

Current Ratio	2.25	Impressive	Industrial Average	1.12
Quick Ratio	1.08
Cash Conversion Cycle	61.60

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 2.25 times in 2016, increase from 2.18 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 higher, indicated that company was an efficient operator in a dominant position within its industry.

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 1.08 times in 2016, decrease from 1.45 times, although excluding inventory so the company still have good short-term financial strength.

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 62 days.

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

Current Ratio Uptrend

LEVERAGE : ACCEPTABLE

LEVERAGE RATIO

Debt Ratio	0.62	Acceptable	Industrial Average	0.41
Debt to Equity Ratio	1.63	Risky	Industrial Average	0.69
Times Interest Earned	3.73	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 3.73 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 0.62 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 : IMPRESSIVE

ACTIVITY RATIO

Fixed Assets Turnover	3.32	Impressive	Industrial Average	-
Total Assets Turnover	1.54	Impressive	Industrial Average	1.25
Inventory Conversion Period	72.02
Inventory Turnover	5.07	Satisfactory	Industrial Average	7.55
Receivables Conversion Period	49.71
Receivables Turnover	7.34	Impressive	Industrial Average	7.10
Payables Conversion Period	60.14

The company's Account Receivable Ratio is calculated as 7.34 and 9.28 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 increased from 34 days at the end of 2015 to 72 days at the end of 2016. This represents a negative trend. And Inventory turnover has decreased from 10.67 times in year 2015 to 5.07 times in year 2016.

The company's Total Asset Turnover is calculated as 1.54 times and 2.02 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 Downtrend

Inventory Turnover Downtrend

Receivables Turnover Downtrend

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	INR 63.74
UK Pound	1	INR 86.01
Euro	1	INR 76.14
Thai Baht	1	INR 1.99

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

INFORMATION DETAILS

Analysis Done by :	PRI

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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This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.