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Saturday, August 27, 2011

KLCI Stock - MRCB / 1651 - 2011 Quarter 2

Company Info
Market Capital (Capital Size)2,702,797,540 (Large)
Par ValueRM 1.00

My Analysis
Forecast P/E now(1.95-0.015)/0.0811 = 23.86 (High)
Target Price1.46+0.015 = 1.47 (PE 18.0, EPS 0.0811, DPS 0.015)
DecisionNot interested unless revenue and profit increase more
Revenue increased 6% and higher than preceding year corresponding quarter 35.1%, eps decreased 12.2% and was second consecutive quarter decreasing but higher than preceding year corresponding quarter 53.9%, no cash generated from operating and cash generated from borrowings also not enough to cover all expenses hence spent 50.5% of Group cash, stronger liquidity ratio at moderate level now, higher gearing ratio at very high level now, all accounting ratio also at high level, major profit contribution from property development division and was largely growth but others mostly also recorded lower performance
First Support Price1.9
Second Support Price1.8

Research House
CIMB Target Price3 (2011-02-10)
AMMB Target Price2.4 (2011-04-08)
UOB Target Price3.02 (2011-07-11)
RHB Target Price2.65 (2011-07-29)
OSK Target Price3.13 (2011-08-02)
HwangDBS Target Price3.25 (2011-08-12)
Kenanga Target Price3.44 (2011-08-17)
MIDF Target Price2.66 (2011-08-17)

Accounting Ratio
Return on Equity6.44%
Dividend Yield0.77%
Profit Margin10.30%
Tax Rate15.61%
Asset Turnover0.2499
Net Asset Value Per Share0.95
Net Tangible Asset per share0.91
Price/Net Tangible Asset Per Share2.45
Cash Per Share0.45
Liquidity Current Ratio2.3476
Liquidity Quick Ratio1.8541
Liquidity Cash Ratio0.7589
Gearing Debt to Equity Ratio2.4929
Gearing Debt to Asset Ratio0.7081
Working capital per thousand Ringgit sale95.9%
Days to sell the inventory140
Days to collect the receivables282
Days to pay the payables280

My notes based on 2011 quarter 2 report (number in '000):-
- Higher revenue due to higher contribution from the Group’s revenue recognition of ongoing and encouraging strata office sales of property development projects at Kuala Lumpur Sentral and the progressive works of the construction and engineering activities. Lower revenue was noted from the infrastructure and environmental segment due to completion of existing environmental projects, with continuation of new phases pending relevant authority approval

- The higher profit for the current quarter was mainly contributed by recognition of progress profit from the ongoing property development projects at Kuala Lumpur Sentral. The recent launch of strata office sales at Kuala Lumpur Sentral, which is known as Q Sentral has begun to register meaningful contribution. Profit was also boosted by the construction activities in Johor Darul Takzim, in particular the Permai Hospital, Eastern Dispersal Link Highway and Marlborough College

- Estimate next 4Q eps after 2011 Q2 result announced = 0.0811, estimate PE on current price 1.95 = 23.86(DPS 0.015)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0156*4*1.3 = 0.0811, estimate highest/lowest PE = 31.87/24.11 (DPS 0.015)
- Estimate next 4Q eps after 2010 Q4 result announced = 1067579*1.3*0.09/1380582 = 0.0905(profit margin per 9%, revenue yearly increase rate 30%), estimate highest/lowest PE = 26.02/21.49 (DPS 0.015)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0188*4*1.1 = 0.0827(profit margin 8%, revenue increase rate 20%), estimate highest/lowest PE = 29.02/22.61 (DPS 0.01)
- Estimate next 5Q eps after 2010 Q2 result announced = 0.0129,0.0175,0.0202,0.0237,0.0313(calculation is based on receivables, revenue, 8% profit margin and 27% tax rate), exclude 0.0129 then cum_eps is 0.0927, estimate highest/lowest PE = 24.49/17.26 (DPS 0.01)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0743, estimate highest/lowest PE = 23.96/18.03 (DPS 0.01)

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