KLCI Stock - ADVENTA / 7191 - 2011 Quarter 2

Company Info

Market Capital (Capital Size)	297,932,251 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(1.95-0.07)/0.156 = 12.05 (High)
Target Price	1.56+0.07 = 1.63 (PE 10.0, EPS 0.156, DPS 0.07)
Decision	Not interested due to high PE compare to it market capital
Comment	Revenue decreased 1.8% but higher than preceding year corresponding quarter 28.6%, eps increased 13.2% but lower than preceding year corresponding quarter 30.9%, no cash generated from operating and cash generated from financing also not enough to cover all expenses, stronger liquidity ratio but still at low level now, lower gearing ratio but still at above moderate level now, all accounting ratio are good, benefit from USD currency slowly recover, benefit from latex price slowly decrease
First Support Price	1.85
Second Support Price	1.7
Risk Rating	MODERATE

Research House

OSK Target Price

3.04 (2011-04-01)

Accounting Ratio

Return on Equity	12.92%
Dividend Yield	3.59%
Profit Margin	2.99%
Tax Rate	-
Asset Turnover	0.8851
Net Asset Value Per Share	1.49
Net Tangible Asset per share	1.47
Price/Net Tangible Asset Per Share	1.33
Cash Per Share	0.19
Liquidity Current Ratio	1.069
Liquidity Quick Ratio	0.6283
Liquidity Cash Ratio	0.1644
Gearing Debt to Equity Ratio	0.9264
Gearing Debt to Asset Ratio	0.48
Working capital per thousand Ringgit sale	3.1%
Days to sell the inventory	76
Days to collect the receivables	76
Days to pay the payables	45

My notes based on 2011 quarter 2 report (number in '000):-
- Lower pbt due to high material cost in latex push manufacturing cost up faster than the Group can pass on to the market

- Latex price in the quarter averaged RM10.31/kg against RM9.28/kg in Q1 2011

- Estimate next 4Q eps after 2011 Q2 result announced = 0.03*4*1.3 = 0.156, estimate PE on current price 1.95 = 12.05(DPS 0.07)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0265*4*1.3 = 0.1378(slowly recover), estimate highest/lowest PE = 16.91/13.5 (DPS 0.07)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.04*4 = 0.16, estimate highest/lowest PE = 17.38/12.44 (DPS 0.07)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.055*4*0.95 = 0.209, estimate highest/lowest PE = 12.39/8.71 (DPS 0.07)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0434*4 = 0.1736*1.1(QbQ improvement adjustment) = 0.191, estimate highest/lowest PE = 16.81/11.78 (DPS 0.07)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.063*4 = 0.252, estimate highest/lowest PE = 15.36/11.35 (DPS 0.07)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0372*4 = 0.1488, estimate highest/lowest PE = 28.83/18.28 (DPS 0.06)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0319*4 = 0.1276, estimate highest/lowest PE = 23.2/11.36 (DPS 0.06)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0272*4 = 0.1088, estimate highest/lowest PE = 19.39/7.77 (DPS 0.06)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.0232*4 = 0.092, estimate highest/lowest PE = 13.04/8.26 (DPS 0.06)

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