TOPGLOV / 7113 - 2010 Q1

My TP: 9.22 (PE 10.37, EPS 0.868, DPS 0.22)
My decison: NOT BUY
Reason: Overvalue

My study based on 2010 Q1 report (number in '000):
- ROE compare to last Q increased 0.43% to 7.15% and also higher than last year 2.45%
- Revenue compare to last Q growth 10.52% to 472300 and profit also growth 14.74% to 65208, mainly due to good cost control, management efficiency, glove quality improvement and also stronger demand due to the higher healthcare standards; As compare to last year revenue growth 23.33% and profit also growth 90.9%, mainly due to efficient and had adapted well to the challenging business environment resulting from cost saving measures implemented at all factories, improvements in product quality, productivity, as well as aggressive marketing strategies to sustain its world market leader position
- Equity compare to last Q increased 7.74% to 911454, assets increased 5.74% to 1197392 but liabilities decreased 0.17% to 285938; As compare to last year equity increased 25.4%, assets increased 7.74% but liabilities decreased 25.63%
- Minority interest compare to last Q increased 5.59% to 22663 and compare to last year also increased 11.74%
- Got FCF 70461, NCF 51211
- Profit margin compare to last Q increased 0.51% to 13.81% and also higher than last year 4.96%
- DE compare to last Q decreased 0.0249 to 0.3137 and compare to last year also decreased 0.2152
- No dividend proposed
- My estimate next 4Q eps after 2010 Q1 result announced = 0.217*4 = 0.868, estimate PE on current price 11.42 = 12.9(DPS 0.22)
- From date 2009-10-09 to 2009-12-16 after 2009 Q4 result announced, highest price on 2009-12-15 was 9.53 and lowest price on 2009-10-29 was 8.14. Estimate next 4Q eps = 0.191*4 = 0.764, estimate highest/lowest PE = 12.19/10.37 (DPS 0.22)
- From date 2009-06-24 to 2009-10-08 after 2009 Q3 result announced, highest price on 2009-10-08 was 8.15 and lowest price on 2009-07-03 was 6.3. Estimate next 4Q eps = 0.1424*4 = 0.5696, estimate highest/lowest PE = 14.04/10.8 (DPS 0.15)
- From date 2009-04-08 to 2009-06-23 after 2009 Q2 result announced, highest price on 2009-06-23 was 6.5 and lowest price on 2009-04-08 was 5.1. Estimate next 4Q eps = 0.1221*4 = 0.4884, estimate highest/lowest PE = 13/10.14 (DPS 0.15)
- Divident in sen 2009 = 0.22(proposed 30% on Q4 and 7 sen on Q3), 2008 = 0.11 (proposed 12% on Q4 and 10% on Q3), 2007 = 0.1 (proposed 12% on Q4 and 8% on Q3)

Lesson learned
- TP should use highest PE estimated
- Can saw strong growth in revenue