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SHARMILA PARTHIBAN

UOG ID : 0003820155

Introduction
“The purpose of this assignment is to recommendation the shareholder of SP Setia
Bhd named Mr. Thomson whether to continue financing in SP Setia Bhd or switch to
Glomac Bhd. This assignment is established on publicly available information as at
March 2013” (J. Kamile, 2012). “This assignment holds companies' cash flow statement,
income statement, and position statements”. “Furthermore, holds explore about the
business structure of the companies, components figuring out interest, marking
methodologies, legislature regulation, bookkeeping degrees, and association of both
companies' presentation” (C. Xie, 2013).

Answer for question (a)
“Monopolistic competition is a market structure in which a big number of small
seller sell close substitute products” (V. Devige & M. Karunagaran 2007., pg 176). In this
market, the goods produced and sold are different, but they close substitutes for each
other. “Monopolistic competition is a combination of perfect competition and monopoly”.
(V. Devige & M. Karunagaran 2007., pg 176).
According to (R. Taman, 2012., pg 112) S P Setia Bhd and Glomac Bhd is
monopolistic rivalry. “In this monopolistic rivalry, the business sector consist of several
purchasers and dealers who exchange over a level of costs as opposed to a solitary
business cost is called monopolistic rivalry” (R. Desish, 2012., pg 12-15). Other than that,
“a reach of value happens since sellers can dispersed their offers to purchasers” (Y.
David, 2013). “Sellers attempt to improve contrast by utilizing client portions, and
nevertheless cost, openly utilizes marking, promoting, and private offering to distinct
their offers” (Y. David, 2013).

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SHARMILA PARTHIBAN
UOG ID : 0003820155

“In this business sector, the products managed and sold are diverse, yet they are close
substitutes for one another and for the sellers is raised rivalry yet for purchasers there are
more decisions” (T. Lim, 2012). “There are few suggestions of monopolistic rivalry
(T.K.Mannormani & P.Khanna, 2009, pg, 6)”. Moreover, “in monopolistic rivalry, the
firm produce products which are divided that is they are not same this furnishes mixture
for customer which will increase buyer fulfilment”. “Existence of many firms
contributing the business sector means the single company's offer of the business sector is
modest and there will limit control over the value of the harvest sold” (T.K.Mannormani
& P.Khanna, 2009, pg, 8).
“Elasticity of passage and passageway of firms in are not straightforward payable to
the item are separation” (T. Lim, 2012., pg 41-42). The unimpeded passage and retreat
includes that financial benefit in monopolistic rivalry is standard. “The interest bend is
descending slanting”. In this manner, it is honourably cost elastics (Y. David, 2013., pg
56-57).

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“Moreover. 2012). pg 11-12).K. age dissemination.Geraid..Khanna. 2004. the more level is the amount commanded for that item and this is brought as” “Contraction popular”.SHARMILA PARTHIBAN UOG ID : 0003820155 Answer for question (b) (i) “It brings “the rule of interest states that the higher the value of an item. “In graceful of this.. an additional major element is the demographics of the populations present”. land businesses are generally neighbourhood” “on account of the normal for fixed nature” (Hasnid. and people developments” (D. 2009. & K. First and leading is people it have to be evident that if the citizenry expansion so will the interest for lodging. 2012. pg 6 ) . The term demographics suggests the abilities of the populations present for example “family estimate. Samid. Mannormani. There are few data that can affect the supply and interest of land” (D. neighbouring interest elements will effect in business. This is transported as “Extension sought after”. & P.. Samid. “the bring down the value of an item. “However the variables that influence the interest for land are the same as those that influence the interest for the most part different items. the amount of individuals. P a g e 3 | 20 . ceteris paribus” (T. the higher is the amount commanded. pg 31).

and park administration”(H. how. S P Setia is cabinets of up to date expectancy for daily comforts. detests and provisions” (H. 2013). “both SP Setia and Glomac Bhd improving and manufacturing mixed bag lands for the client”. 2013).SHARMILA PARTHIBAN UOG ID : 0003820155 Answer for question (b) (ii) “Branding is the programme controlled in manufacture an excellent given name and in addition amount for a property in the purchaser mentality” (Y. Furthermore. “This both company's reason for existing is to make a middle of consideration their buyer through beautiful marking in property” (H. According (marketing. 2012). “Marking additionally plans to start the paramount and separated participation in the business sector with the proposition of draws in and holds reliable buyer” (Y.Raid. 2013). “Market division is drew as an improvement in which buyers are divided dependent on partition groups dependent upon reported likes. land organizations. Ramif. or assortment will be showcased” (P. give agreeablesounding and quiet dominions with gated and ensured supervision which is a preference to reach home as well”. “Furthermore. “this defend to decreasing the risk of selecting where. This provides the buyer the choice to finish their requirements from selection suitable possessions to them. 2013). Samid. when. the business can target its 1deals on every specific assembly of buyer”. 2013) “the most extreme deals. “concerned in land development. 2013). 2012). and to whom an inspiration. structure development. Ramif. Raid. P a g e 4 | 20 . For instance. S P Setia and Glomac is progresses accommodation and gorgeous lands (real. Raid. For outline. Besides. principally all through the promoting fights near a solid start”. analyze. “A moderniser of discernment living.

Moreover. 2012). Glomac gladly conveyed a first-of-its-caring gated and watched group in Petaling Jaya”. 2012). Other than that. Glomac (T.Jaid. Com. “Glomac Bhd has improved abroad contract advance plans where Malaysians will have a nearby contract advance office in Malaysian Ringgit for buys of lands abroad for example in London” (W. 2013). and consequently S P Setia Bhd was arranged up the NO 1 artist in Malaysia at The Edge Malaysia Top Property Developers Awards 2012 for the seventh time” (A. a philanthropy trust made by S P Setia Berhad welcomes fiscally poor and educationally meriting understudies to petition its grants to follow full time certificate and progress recognition programmes at College Tunku Abdul Rahman and degree programme at University Tunku Abdul Rahman” (S P Setia. Lee. 2013) “for example the 6-8 storey business focus were familiar with Glomac's growths for example Glomac Business Centre. 2011) “S P Setia has higher their Innovative space organising and green living is brought to new figures with imposing green and open space and Parklands are made available prompt behind where nature stroll and instructive exercises could be allowed”. “With admiration to towering-end private infrastructures. Kelana Business Centre and Kelana Centre Point finish with lifts and an underground stopping range” (Business. Damen. “In terms of development S P Setia Foundation. P a g e 5 | 20 .SHARMILA PARTHIBAN UOG ID : 0003820155 Answer for question (b) (iii) According to (Riad. 2012). unwinding with companions and hosting humble occasions. “It's the ideal venue for family silly buffoonery.

Kai. Housing Development “Control and Licensing)” Act 1966. “Regulation which in the abovementioned Regulations are implied as the "essential Regulations". 2013)”. The Housing Designers “(Control and Licensing)” Regulations 1989.SHARMILA PARTHIBAN UOG ID : 0003820155 Answer for question (b) (iv) “In Malaysia. “Confinement against change of colour junction” (M. P a g e 6 | 20 . Bank Negara Malaysia (BNM) or the Central Bank of Malaysia is dependable in executing the legislature's financial arrangement”. 2013). K Nathan. are corrected in statement 13 of Schedule G by embedding’s after that proviso this proviso 13A”. Bank Negara Malaysia is answerable for regulatory the business banks in Malaysia. 2012). “A provision for the reinstatement of a lodging planner's licence may be made when the date of expiry and the Organizer may concede a reinstatement of the licence with or without joining conditions thereto or decline to concede a reinstatement of such licence” (P. “If the registration of the applicant's architect or engineer has been cancelled and has not been restored under the Architects Act 1967 [Act 117]” or “the Registration of Engineers Act 1967 [Act 138] at the time the application is made”. “These rules may be cited as the Housing Development (Control and Licensing) Regulations 1989 and shall come into strength on the 1st April 1989 (Bank Negara Malaysia.

2013)”. work and play. could be basically stated that both land industry have lifelong-goals where it is expected destiny (Annual report. immoral and development company”. Kai. SP Setia Bhd “The past objectives of this company was targets were to give teenagers between the really long time of 5 and 12 with healthful exercises that attention inventive statement. “Since the day of stronghold the Company's for the most part goal was to take lifelong-worth to its shareholders” (Star. “time to come targets and achievement the recompense bundles are structured to incentivize and hearten innovativeness and improvement fitting for a property. 2012).6billion. the Group is heading off to be to a great degree gainful”. “The company's successes and achievement were the outcome of teamwork and innovativeness into their society”. 2013)”. environmental mindfulness and neighbourhood life” (I. The company's arrangement is to help improve the personal satisfaction by securing a better place for all too live. S P Setia additionally has future destination to attain RM5.2013). Glomac Bhd “The past target of the company was to get Gross Development Value of RM2.5b deals in monetary year” 2013 (P. Moreover. “In the past Glomac's leader township infrastructure in Sungai Buloh was constrained on to produce reasonable bargains of RM10 to RM12 million for every month (star. “For every S P Setia Bhd and Glomac Bhd 2012 Annual Reports. P a g e 7 | 20 . “Separated from that. each accumulation or firm may as well have certain destinations or plans to assurance the firm is composed and heading off to the right way”. 2013).SHARMILA PARTHIBAN UOG ID : 0003820155 Answer for question (c) “With a specific end goal to perform well. Panisah.

advancement and maintenance of workers in the working environment. Also that.SHARMILA PARTHIBAN UOG ID : 0003820155 “The company needs to be recognised by their clients. P a g e 8 | 20 . 2012)”. the company looks after exclusive expectations of recruitment. for fate improvement of the company (Edge. shareholders and legislatures as a planet-class property planner.

2013). “There are different sources and utilizations of trusts for the banks and a few samples of the aforementioned sources and uses have been said beneath” (F. Pakir. The company has opened its limbs in some Asian nations”. SP Setia Bhd is prepared to addition more cash and give more payments in intention (SP Setia Annual Report 2012). Equity instruments issued by the Group and the Company are recognised at the incomes received. Ealit. Asing. it gets cash from premium appropriated and rental accepted while utilizes the cash for buy of lands. net of direct issue costs.” “Under financing exercises. 2012) “The monies that the company utilized for certain purposes could improve its exhibition”. Regular shares are classified as equity” (V. “Regular shares are recorded at the takings received. the company gets cash from premium while operates the cash for yields to shareholders”. Both company which is “S P Setia and Glomac get and utilization its finances from working exercises. and financing actions”. “Dividends on ordinary shares are recognised in equity in the period in which they are declared”. SP Setia Bhd “The company runs under obligation financing on the grounds that the sum liabilities is more than the sum values”. the company gets cash from rental salary and operation its cash for decline of lands. net of direct attributable transactions costs”. Below managing actions. “SP Setia has Dividend Reinvestment Plan (DRP) where shareholders could choose whether to acknowledge payments or reinvest”. For instance. “Under contributing actions. By achievement this. Moreover. “SP Setia Bhd has utilized some of its cash for its establishment to.SHARMILA PARTHIBAN UOG ID : 0003820155 Answer for question (d) Glomac Bhd and S P Setia Berhad “an equity instrument is any contract that evidences a residual interest in the assets of an entity after deducting all of its liabilities (Annual report 2012)”. (B. P a g e 9 | 20 . 2012). contributing actions. Regular shares are equity instruments.

SHARMILA PARTHIBAN UOG ID : 0003820155 Glomac Bhd “The company runs under value financing in light of the fact that the aggregate liabilities is less than sum values”. “Case in point. Glomac Bhd has utilized some of its cash for its establishment to (Glomac Annual Report 2012)”. the company gets cash from rental salary and utilization its cash for devaluation of lands”. “Under managing actions. “Under financing exercises. it gets cash from premium accepted (R. the company gets cash from Drawdown of term advances and connecting credits for reimbursement of bonds”. Below subsidising actions. “The trusts”. “The monies that the company utilized for certain purposes could upgrade its exhibition”. P a g e 10 | 20 . While utilizes the cash for buy of lands. 2013). Takai.

Current ratio of S P Setia has increased in 2013 if compare to 2012 which means that the company has ability pay its liabilities. Gearing is higher in 2013 than in 2012.24% than REC in 2013. It indicates the number of times an association is capable of paying disbursements to shareholders from the profits earned. The greater margin shows that the S P Setia is more systematic cost management. S P Setia price earnings ratio has increased 3. Dividend yield of S P Setia in 2012 is higher than 2013.73 in 2013 which suggests that investors may be looking favorably at S P Setia. Interest coverage ratio of 2012 is higher 3.04 million in 2012 than 2013. This indicates that 2013 has a great system for transforming investor capital into profits than 2012. Earnings per share of S P Setia higher RM 0. This increase is mainly due to expansion of net income.68% than 2011. good financial controlling and potential efficiently in business during 2012.1 in appendix S P Setia operating profit margin has increased in 2012 than the margin in 2013 by approximately 3.82%. REC in 2012 is less 28. Dividend coverage ratio in 2013 is longer than in 2012. 0. It indicates that the capacity of S P Setia to pay its interest obligations longer in 2012 than 2013. P a g e 11 | 20 .SHARMILA PARTHIBAN UOG ID : 0003820155 According to table 1.21%.

Answer for question (e) P a g e 12 | 20 . It shows the number of times an association is capable of paying disbursements to shareholders from the profits earned. This indicates that 2012 has a great system for transforming investor capital into profits than 2013.SHARMILA PARTHIBAN UOG ID : 0003820155 According to table 1.2 in appendix Glomac operating profit margin has decreased in 2013 than the margin in 2012 by approximately 2. Dividend yield of Glomac in 2012 is higher than 2013. This low margin reflects that the Glomac is less efficient cost management. This decrease is mainly due to growth of net revenue. It shows that dividend paid by Glomac in 2012.79 in 2013 which suggests that investors may be looking less favorably at Glomac.93 higher than in 2013. Current ratio of Glomac has increased in 2013 if compare to 2012 which means that the company has ability pay its liabilities. RM 0. Glomac price earnings ratio has decreased 0. REC in 2013 is less 3.03%.14%. Gearing is higher in 2013 than in 2012. good cost control and low productivity in company during 2013.17 in 2013 than 2012. Interest coverage ratio of 2012 is less 7. Earnings per share of Glomac higher RM 4. 0.61% than 2013.44% than REC in 2012. It indicates that the capacity of Glomac to pay its interest obligations longer in 2012 than 2013. Dividend coverage ratio in 2013 is longer than in 2012.

“Malaysian unemployment rate in December 2008 was 2. “As per the Malaysian Department of Statistics. costs of products and utilities will be higher and consequently the benefits will be higher simultaneously” (Annual Report 2008)”. “However.SHARMILA PARTHIBAN UOG ID : 0003820155 In 2008. “Depending on if the expansion rate is elevated.000 individuals were unemployed (Annual Report 2008)”. S P Setia bhd and Glomac bhd shareholders will accept higher profits”. “Notwithstanding. the expansion rate or Consumer Price Index (CPI) of Malaysia in 2008 expanded by 1. “Because of this. the income that is gotten by legislature through earnings duties will drop (bartering.1 in 2008 (statistics. “In any case.7% to 104. “the Malaysian economy developed emphatically. “This will create the organization to control the administration's consumptions which could decrease advancement actions of the economy”. the legitimate worth of the cash will be less”. “Through expansion. “Together property could additionally lose their salaried labourers as their pay rates were of fewer qualities (statistics. “Furthermore. This rate is not too very tall and could be thought about under control.9 contrasted and that of 102. if the unemployment rate is heightened. hauling part could some way or another addition and lose”. 2008)”. the worth of cash will drop and along these lines when property accepted cash owed to them by clients. 2008)”. P a g e 13 | 20 . “Open and private company’s financings were towering (Annual Report 2008)”. 2008)’. beating estimates”. S P Setia Bhd and Glomac Bhd have their branches in other countries as well such as in Singapore and India (blr 2008)”. Open consumption builds more than needed to the finish of the year. Reasonable budgetary development and flat yield will hasten further sorrow. “Lodging area will be influenced as there will be fewer individuals included in the purchasing of the houses” (Annual Report 2008)”. the foreign economic climates are also necessary for the hauling to operate well”.9% where 259.

Thamin to change investing in Glomac” (Glomac. “Even though the dividend cover is lower as compared to SP Setia. Com. there is one exclusive company that might be thought about the best as contrasted with the other to invest into”. can be concluded that Glomac is a better company to invest in as its return on capital employed. dividend yield. it is recommended to Mr. and current ratio are higher than SP Setia (S P Setia. The dividend professed by Glomac to its shareholders was higher than that of SP Setia.SHARMILA PARTHIBAN UOG ID : 0003820155 Conclusion “Every one of the discoveries of SP Setia Berhad and Glomac Berhad have been stated and illustrated as one with the proportions figuring’s and fiscal explanations of both company’s so as to support in choice making for contribution” (D. 2013). (2841 Words) P a g e 14 | 20 . “There are additionally some macro-financial elements that will influence both company performance as elucidated in this report (Annual Report 2012)”. business division and feature advancement”. 2013). Menaid. “In spite of the fact that both company have very nearly the same pros and cons. current price or earnings ratio. Glomac has higher earnings per ordinary share as compared to SP Setia which means that Glomac has high profits which will be more than enough to cover the dividend to shareholders”. 2012)”. Recommendation “Based on the research that have been done on SP Setia Bhd and Glomac Bhd using 2012 and 2013 information. “S P Setia and Glomac have its particular systems of marking. “Therefore. “Both company’s gained finances from different sources and utilized those stores for different expenditures particularly for shareholder's share and the advancement of the company”. earnings per ordinary share.

13 (15). P a g e 15 | 20 . Innovation and new product of development. Devige. p1112. What is implication of Glomac BHD. Glomac BHD. Taman. Damen. p23-32. p64. p8. Monopolistic Competition.Glomac BHD. S P Setia DHD. (2013). C. What is monopolistic competition. Devige. V & Karunagaran.SHARMILA PARTHIBAN UOG ID : 0003820155 Reference Kamile. Y. Y. M. and International Trade. Excess Capacity in Monopolistic Competition. What is implication of S P SETIA BHD. Glomac BHD. Desish. 16 (8). (2012). (2009). Factors of demand and sales. (2012). 5 (7). p12-15. Branding of product. Hasnid. 12 (5). R.Monopolistic competition. T K & Khanna. (2009). p90-92. Ramif. and International Trade. Implication . p8. Lee. Lim. Glomac BHD. 7 (2). Monopolistic Competition. 12 (2). p31. H. Fundamental Analysis for S P SETIA BERHAD. Innovation of development. R. S P Setia DHD. (2012). Factors of demand and sales. 11 (6).J. p6. p3. p112. p55. r Geraid. (2013). S P Setia DHD. T. Two Theories of Monopoly and Competition: Implication. Definition Monopolistic Competition. p176. Glomac BHD. Taman. P. Definition Monopolistic Competition. 7 (2). p41-42. 5 (9). p12. P. Introduction . K. Manormani.Glomac BHD.Monopolistic competition. Monopolistic Returns. Branding of product of market segmentation. V & Karunagaran. What is monopolistic competition. David. What is implication of Glomac BHD. 2 (3). Raid. (2004). Increasing Returns. (2012). p9-15. Glomac BHD. 19 (11). 5 (7). (2013). (2012). M. Samid. (2012). (2012). T. (2007). T K & Khanna. 15 (7). R. A. Xie. 6 (9). Manormani. (2007). (2013). 11 (6). (2012). 4 (6). 7 (1). p176. Introduction to S P Setia. D.

I. (2012). P a g e 16 | 20 .com. 21 (5). (2012). (2012). W.com. Runners. Equity and Debts. S P Setia DHD.com. T. Last accessed 12th March 2014. S P Setia Annual Report. Effect of company for future performance. S P Setia DHD. F. Annual Report. p14-19. p11-19. what is RDN. p9-11. 17 (8). P. Glomac BHD. (2012). (2013). Glomac BHD. 20 (9). P.com. Equity and Debts. (2013). Nathan.thestar. M K. B. (2012).iproperty. Available: http://www. Regulations of goverment. T. Last accessed 17th March 2014. p87-89. long or short term. p9-19. Glomac BHD. Ealir. Panisha. (2013). p68-76. (2012). Panan. Glomac BHD. Available: http://topdevelopers2012. long or short term. Star. S P Setia DHD. Regulations of goverment i price. Pakir. D. p33-39. p6-14. 18 (14). (2012). 9 (3). what is objective near future. S P Setia. 14 (2). Lizza. 4 (1).SHARMILA PARTHIBAN UOG ID : 0003820155 Jaid. Impact of micro-economic. 17 (3). V. 31 (18). Conclusion of the company.my/developer/s-p-setia-berhad-group. Kai.my/. p19-28. Menaid. Asiny. (2012).

06 3.298.728 2.244.422.298.135.595.59% = 0.800 =RM28.800 0.23 0.980.69% 567.127 = 1832738000 341992229 = RM 0.21 = RM 3.000 =RM 0.000 323.067.15 722.43 0.403 =0.067.322.592.000 -2.000 2.448 (9.406.SHARMILA PARTHIBAN UOG ID : 0003820155 ACCOUNTING RATIO RATIOS Operating Profit Margin S P SETIA DHD 567.950.64% Earnings Per Ordinary Share 387628000 119.27 0.000) (1.63% = 15.448 652.35:1 =2.985 =RM 0.56:1 =5.466) = 88.1478 3.000 = = 22.205 =RM1.23:1 2363940000 331.41:1 3.27 0.985 0.415.526.47% Current Price/Earnings Ratio = Dividend Yield = Dividend Cover = Current Ratio = Gearing = P a g e 17 | 20 .441.505.353.205 0.505.46 % Return on Capital Employed = GLOMAC BHD 161.50 0.038 4039120000 698.244.466 =1.1478 =0.353.304.907 -323.115 0.000 161.950.115 0.076 = 24.

000 15.000 161.592.12% Note: All the values from the ‘Accounting Ratio’ table have been taken from SP Setia Annual Report 2012 and Glomac Annual Report 2012.448 79.SHARMILA PARTHIBAN UOG ID : 0003820155 Interest Payment Cover = 567.067. P a g e 18 | 20 .13% = 10.505.049 =7.908.

78:1 3.000 153.50% = Current Price/Earnings Ratio = Dividend Yield = Dividend Cover = Current Ratio = Gearing = P a g e 19 | 20 .000- (1.287 108.55% 570.697.596.257.287 =4.000 = Return on Capital Employed = 18.933.17 = RM 7.13 0.148 18.343.528.520.920.736.153.114.000) = 60.770-338.04:1 =2.310 = 2.156 =RM 1.257.509 = RM 0.997.257.71% = 0.190.762.030.39% = 12.000 3.20% Earnings Per Ordinary Share 419.114.511 = 22.50 =RM 7.000 838.030.343.65 6.79 940.891 5.848.458.22 419.060.035.50 18.520.310 254.0 0.535.110.712 14.287 =RM 0.537 2.477 28.000 338.310 419.0 108.62:1 =4.719 680.719 (12.072 =0.000 =RM 3.67 0.809 =2.118.997.29:1 0.SHARMILA PARTHIBAN UOG ID : 0003820155 ACCOUNTING RATIO RATIOS Operating Profit Margin S P SETIA DHD 570.524.756.30 108.64 % GLOMAC BHD 153.807) 2.000 419.441.

51% Note: All the values from the ‘Accounting Ratio’ table have been taken from SP Setia Annual Report 2013 and Glomac Annual Report 2013.343.SHARMILA PARTHIBAN UOG ID : 0003820155 Interest Payment Cover = 570.101. P a g e 20 | 20 .375 =3.000 153.000 21.286.520.63% = 2.719 157.