KLCI Stock - CSCTEL / 5094 - 2009 Quarter 4

Par Value: 1.00
Market Cap : 380000000*1.95 = 741,000,000 (Small)
NTA per share : 778466/373200 = 2.09
P/BV : 1.95/2.09 = 0.933 (Undervalue)
Forecast P/E now : (1.95-0.2)/0.2936 = 5.96 (Low)
ROE : 11.71% (Moderate)
DY : 0.2/1.95*100 = 10.26% (High)
Fixed Asset Turnover(4 year) : (1.0066+1.7454+1.5629+1.263)/4 = 1.3945 (High)
Liquidity Ratio : 526725/41569 = 12.6711 (Very Strong)
Receivables Collection Period : (95802+87073)/2/(869936/365) = 38 days (Good)
My Target Price : 2.35+0.2 = 2.55 (PE 8, EPS 0.2936, DPS 0.2), around 30% price increased from 1.95
My Decision : BUY
My Comment : World steel price increasing, good cash flow, low debt, strong cash, navps increasing, some risk due to Lembaga Tabung Angkatan Tentera disposed shares
Technical Support Price : 1.75, 1.66
Risk Rating : HIGH

My notes based on 2009 quarter 4 report (number in '000):-
- The Group achieved 33.5% higher in revenue than that of its corresponding quarter, due to the significantly higher sales volume of our steel products
- Compared to preceding quarter, the Group's revenue has increased by 4.7% primarily due to higher selling prices of our steel products albeit at a marginally lower sales volume
- Despite the higher revenue, profit before tax reduced by 19.8%. This is mainly due to the significantly higher raw materials cost
- Lembaga Tabung Angkatan Tentera disposed quite number of shares recently
- Estimate next 4Q eps after 2009 Q4 result announced = 0.2936 (20% growth from 0.2442, world steel price increasing), estimate PE on current price 1.95 = 5.96(DPS 0.2)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.24, estimate highest/lowest PE = 6.42/4.92 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.1012, estimate highest/lowest PE = 13.83/9.88 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.0612, estimate highest/lowest PE = 18.3/15.44