KLCI Stock - GTRONIC / 7022 - 2011 Quarter 1

Company Info

Market Capital (Capital Size)	272,394,100 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(1.03-0.07)/0.1253 = 7.66 (Moderate)
Target Price	1.13+0.07 = 1.20 (PE 9.0, EPS 0.1253, DPS 0.07)
Decision	BUY
Comment	Revenue decreased 8.7% and is second consecutive quarter decreasing but higher than preceding year corresponding quarter 11.4%, eps decreased 16% and is second consecutive quarter decreasing but higher than preceding year corresponding quarter 3.4%, cash generated from operating is more than enough to cover all expenses, stronger liquidity ratio at moderate level now, lower gearing ratio at below moderate level now, all accounting periods are good, from historical result to compare, Q1 normally lower result than other quarter
First Support Price	1.0
Second Support Price	0.9
Risk Rating	MODERATE

Research House

MIDF Target Price

1.4 (2011-04-27)

Accounting Ratio

Return on Equity	12.62%
Dividend Yield	8.97%
Profit Margin	11.15%
Tax Rate	14.09%
Asset Turnover	0.9484
Net Asset Value Per Share	0.93
Net Tangible Asset per share	0.93
Price/Net Tangible Asset Per Share	1.1
Cash Per Share	0.21
Liquidity Current Ratio	2.5438
Liquidity Quick Ratio	2.2832
Liquidity Cash Ratio	1.1911
Gearing Debt to Equity Ratio	0.2154
Gearing Debt to Asset Ratio	0.1772
Working capital per thousand Ringgit sale	25.6%
Days to sell the inventory	18
Days to collect the receivables	66
Days to pay the payables	50

My notes based on 2011 quarter 1 report (number in '000):-
- The decrease in turnover and net profit is mainly due to lower volume loadings after the respective customers’ festive seasons order had been met

- The Group’s turnover and net profit for the quarter ended 31 March 2011 increased by 11.4% and 4.5% respectively as compared to the same period last year mainly due to higher volume loadings from certain of the Group’s customers

- Estimate next 4Q eps after 2011 Q1 result announced = 0.1139*1.1 = 0.1253, estimate PE on current price 1.03 = 7.66(DPS 0.0965)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0326*4 = 0.1304(no decrease due to high tax expenses), estimate highest/lowest PE = 8.46/6.85 (DPS 0.0965)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0326*4 = 0.1304, estimate highest/lowest PE = 8.97/7.67 (DPS 0.09)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.026*4 = 0.104(0.026 is average of latest recent quarter), estimate highest/lowest PE = 13.94/8.94 (DPS 0.09)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0904+0.0007+(0.0911*0.05) = 0.0957(adjustment from 0.0233-0.0226 and 5% grow adjustment), estimate highest/lowest PE = 16.61/12.85 (DPS 0.08)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0226*4 = 0.0904, estimate highest/lowest PE = 18.36/9.07 (DPS 0.07)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0183*4 = 0.0732, estimate highest/lowest PE = 15.64/8.74 (DPS 0.055)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0137*4 = 0.0548, estimate highest/lowest PE = 15.78/13.05 (DPS 0.025)

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