KLCI Stock - TENAGA / 5347 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	34,195,422,764 (Very Large)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(6.27-0.195)/0.4424 = 13.73 (High)
Target Price	5.31+0.195 = 5.50 (PE 12.0, EPS 0.4424, DPS 0.195)
Decision	Not interested unless coal price decrease
Comment	Revenue increased 3.5% and also higher than preceding year corresponding quarter 0.6%, eps decreased 169.8% and is second consecutive decreasing and also lower than preceding year corresponding quarter 139.7%, cash generated from operating is not enough to cover financing activities and some more got large investing expenses, used up 24.9% of Group cash, weaker liquidity ratio at low level now, lower gearing ratio but still at high level now, all accounting ratio are good, high coal price, income from foreign exchange still not stable
First Support Price	5.95
Second Support Price	5.6
Risk Rating	HIGH

Research House

RHB Target Price	7.5 (2011-01-18)
Citi Target Price	7.9 (2011-05-31)
HwangDBS Target Price	8.8 (2011-05-31)
AMMB Target Price	6.6 (2011-06-13)
CIMB Target Price	8.05 (2011-06-16)
MIDF Target Price	7.98 (2011-06-21)
HLG Target Price	7.91 (2011-07-12)
Kenanga Target Price	7.93 (2011-07-18)
Maybank Target Price	7.05 (2011-07-18)
ECM Target Price	7.61 (2011-07-22)
OSK Target Price	7.53 (2011-07-22)

Accounting Ratio

Return on Equity	4.46%
Dividend Yield	3.91%
Profit Margin	-7.74%
Tax Rate	-
Asset Turnover	0.4223
Net Asset Value Per Share	5.31
Net Tangible Asset per share	5.31
Price/Net Tangible Asset Per Share	1.23
Cash Per Share	1.15
Liquidity Current Ratio	1.4723
Liquidity Quick Ratio	1.1722
Liquidity Cash Ratio	0.6819
Gearing Debt to Equity Ratio	1.5168
Gearing Debt to Asset Ratio	0.6022
Working capital per thousand Ringgit sale	14.1%
Days to sell the inventory	34
Days to collect the receivables	53
Days to pay the payables	83

My notes based on 2011 quarter 2 report (number in '000):-
- Higher revenue mainly due to electricity demand grew

- Loss mainly due to higher generation costs from utilization of coal, oil and distillate, resulting from severe gas curtailment

- The average price of coal consumed was USD103 compared to USD85.1 per metric tonne in FY10Q3

- Price moving after 2011 Q3 result announced mainly base on technical analysis and ad-hos news, however if based on average eps of FY11Q1 & FY11Q2, 4Q eps = 0.1229*4*0.9 = 0.4424, estimate PE on current price 6.27 = 13.73(DPS 0.195)
- Estimate next 4Q eps after 2011 Q2 result announced = (0.1415+0.163)*2*1.05 = 0.6395, estimate highest/lowest PE = 10.96/9.01 (DPS 0.2)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.7355*0.8 = 0.5884, estimate highest/lowest PE = 10.74/9.74 (DPS 0.21)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.089*4 = 0.356, estimate highest/lowest PE = 24.21/21.88 (DPS 0.26)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.71*1.05 = 0.7455 (5% increase adjustment), estimate highest/lowest PE = 12.22/11.21 (DPS 0.183)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.2066+0.1859+0.1673+0.1506 = 0.71 (average 10% drop each quarter, coal price increasing but strong Ringgit offset some impact), estimate highest/lowest PE = 12.14/11.01 (DPS 0.183)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.6484, estimate highest/lowest PE = 13.38/11.67 (DPS 0.163)

Coal price chart
- http://www.mongabay.com/images/commodities/charts/chart-coalaust.html
- http://www.globalcoal.com/

MYR/JPY chart

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