In order to decide whether or not to invest in a customer (Client A), the important

financial ratios to analyze are current ratio, accounts receivable turnover, debt-to-asset
ratio, return on assets, and earnings per share.

Current ratio refers to the ratio of current assets and current liabilities held by a
company during a certain operating period. This ratio is used to measure a company's
ability to convert liquid assets into cash in order to repay short-term liabilities before
maturity. Currently, it is one of the ratios that reflect financial conditions and is often
used to measure short-term payment ability of companies. This is an important
measure of liquidity, as short-term liabilities come due next year. The higher the
liquidity ratio, the greater the liquidity of corporate assets. A high current ratio means
that more liquid assets are occupied, which affects the turnover efficiency and
profitability of working capital. Generally, 2 is considered a reasonable minimum
flow rate ratio. Also, it should be noted that even if the current ratio is high, it does
not necessarily mean that the repayment capacity of short-term borrowings is strong.
The higher the ratio, the better for investors. From the table of financial ratio indicates
that the current ratio of Kossan Rubber Industries Berhad is 4.34 (2021) which
increase 2.56 from 1.78 (2018). This shows that DRB-HICOM has increase the ability
efficient to pay its short-term debt and has enough liquid assets of its operation.

Receivable turnover ratio can quantify the speed at which the company recovers the
accounts receivable, shows the number of times the company collects the arrears
within a year, and can see the efficiency of the company in collecting accounts
receivable or customer arrears. The increase in Kossan Rubber Industries Berhad's
receivables turnover ratio from 5.3 (2018) to 11.28(2021) may indicate that Kossan
Rubber Industries Berhad is conservative in providing credit to customers and
efficient or aggressive in its collection practices. The higher the accounts receivable
turnover ratio, the better for the company.

The debt-to-asset ratio is a leverage ratio that measures the amount of total assets
financed by creditors rather than investors. The percentage of Kossan Rubber
Industries Berhad’s assets that financed by debt increase from 0.04/4% in 2018 to
0.39% in 2019 follow by decrease to 0.2 in 2021. The increase of debt ratio in 2019
means that Kossan Rubber Industries Berhad had s higher number of assets that
financed by debt. A lower ratio is better because the business has less total debt
compared to its asset base. The lower the ratio indicate that the business is in a save
condition from becoming insolvent and even going bankrupt. The decrease of debt
ratio in 2021 means that Kossan Rubber Industries Berhad had a low number of assets
that financed by debt. This situation is good for the company because the company
has more assets than liabilities.

Return on Assets (ROA) is a metric that measures the net income generated by each
asset unit and helps assess a company's profitability in terms of total asset value.
Return on Assets is one of the most widely used measures of bank profitability in the
industry. The higher the ratio, the higher the utilization of the company's assets,
indicating that the company is achieving better results such as increased revenue and
reduced costs, and vice versa. In other words, the ratio measures how efficiently a
company manages its assets to generate profits over a period of time. The higher the
ratio, the better for investors. Kossan Rubber Industries Berhad’s return on assets
increase from 8% in 2028 to 33% in 2021. This significantly increase of return on
asset shows that DRB-HICOM Berhad had perform more productive and efficient
management in the use of economic resources to generate sales.

Book Value Per Share is a measure of the net asset value of a listed company on a
per-share basis. Book value per share is calculated by comparing a company's book
value with all outstanding shares. Investors can calculate a company's book value per
share and compare it to the company's current market price per share to gauge
whether a company's stock is undervalued. A higher book value per share usually
means that the company is undervalued. The company's stock is more valuable and
should increase in price. The book value per share ratio increase for year RM0(2018)
to RM0.07(2021). Higher book value per share is always better than a lower ratio
because it shows the company’s stock is more valuable to investor.