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Sunday, April 17, 2011

KLCI Stock - BSTEAD / 2771 - 2010 Quarter 4

Company Info
Market Capital (Capital Size)5,481,147,369 (Very Large)
Par ValueRM 0.50

My Analysis
Forecast P/E now(5.83-0.39)/0.5557 = 9.79 (Moderate)
Target Price7.78+0.39 = 8.17 (PE 14.0, EPS 0.5557, DPS 0.39)
Revenue increased 11.6% and is second consecutive quarter increasing and also higher than preceding year corresponding quarter 14.1%, eps increased 127.4% and also higher than preceding year corresponding quarter 37.2%, cash generated from operating is not enough to pay financing activities, liquidity ratio improving but still at weak level now, high gearing ratio, all accounting periods are good, CPO price decreasing, venture into aviation business, working on to involve in the land development, bought PHARMA
First Support Price5.4
Second Support Price5.15

Research House
ECM Target Price5.96 (2010-04-04)
S&P Target Price6 (2010-11-30)
TA Target Price6.94 (2010-12-23)
HwangDBS Target Price8.1 (2011-02-07)
CIMB Target Price6.06 (2011-02-28)
AMMB Target Price5.2 (2011-03-29)
HLG Target Price7.87 (2011-04-13)

Accounting Ratio
Return on Equity11.44%
Dividend Yield6.69%
Profit Margin14.91%
Tax Rate6.87%
Asset Turnover0.667
Net Asset Value Per Share4.52
Net Tangible Asset per share3.43
Price/Net Tangible Asset Per Share1.57
Cash Per Share0.45
Liquidity Current Ratio0.5581
Liquidity Quick Ratio0.4836
Liquidity Cash Ratio0.1137
Gearing Debt to Equity Ratio1.0808
Gearing Debt to Asset Ratio0.493
Working capital per thousand Ringgit sale-26.7%
Days to sell the inventory18
Days to collect the receivables76
Days to pay the payables72

My notes based on 2010 quarter 4 report (number in '000):-
- Notable increase in revenue from both the Plantation and Trading Divisions was attributable to the stronger palm product prices and higher sales volume respectively

- During the year, the Division achieved an average palm oil price of RM2,622 per MT, an increase of RM452 or 21% against last year corresponding period's average of RM2,170 per MT. The cumulative FFB crop totalling 1,070,455 MT was 3% lower

- During the year, the Division’s investment property portfolio had appreciated and contributed a fair value gain of RM52 million. At the same time, performance for property development, retail mall operations and hotels also improved

- Finance & Investment Division got interest savings at Boustead Holdings level and better earnings from the Affin group as well as the disposal of BH Insurance had enhanced the Division’s performance

- During the period, all the operating units in the Division had performed well, with notable increase from BH Petrol operations which enjoyed an increase in sales volume and stockholding gains

- Plantation profit for the current quarter was 27% better than the preceding quarter, mainly due to stronger CPO price which averaged at RM2,977 (Previous quarter: RM2,554) per MT

- Property Division’s pre-tax profit was better than the previous quarter, on fair value gain on investment properties and higher progress billings

- Heavy Industries Division’s profit for the current quarter was marginally lower than the preceding quarter mainly on cost escalation

- The Finance & Investment Division’s profit for the current quarter was higher, mainly on improved contribution from the Affin group. Trading Division registered a two-fold increase in pre-tax profit during the current quarter, on better sales volume and stockholding gain

- Estimate next 4Q eps after 2010 Q4 result announced = 0.2646*2*1.05 = 0.5557(exclude RM52 million one off gained), estimate PE on current price 5.83 = 9.79(DPS 0.39)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.1*4*1.1 = 0.44, estimate highest/lowest PE = 13.11/11.14 (DPS 0.37)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.08*4*1.05 = 0.336(0.08 is eps exclude non-repeatable income), estimate highest/lowest PE = 17.04/11.59 (DPS 0.325)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.4699*1.05 = 0.4934(5% increase), estimate highest/lowest PE = 8.3/6.58 (DPS 0.275)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.4934, estimate highest/lowest PE = 7.1/6.31 (DPS 0.275)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.1241*4 = 0.4964, estimate highest/lowest PE = 6.89/6.06 (DPS 0.25)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0721*4 = 0.2884, estimate highest/lowest PE = 12.17/10.92 (DPS 0.2)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.0934*4 = 0.3736, estimate highest/lowest PE = 11.78/8.94 (DPS 0.2)
- Estimate next 4Q eps after 2008 Q4 result announced = 0.1699*4 = 0.6796, estimate highest/lowest PE = 5.15/3.97 (DPS 0.3)

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