KLCI Stock - MISC / 3816 - 2011 Quarter 5

Company Info

Market Capital (Capital Size)	31,023,362,065 (Very Large)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(6.95-0.25)/0.3 = 22.33 (High)
Target Price	6.00+0.25 = 6.25 (PE 20.0, EPS 0.3, DPS 0.25)
Decision	Not interested unless stock price sustain above 7
Comment	Revenue increased 2.9% but lower than preceding year corresponding quarter 8%, eps increased 139.3% but lower than preceding year corresponding quarter 71.7%, cash generated from operating and financing enough for investing expenses, weaker liquidity ratio at low level now, higher gearing ratio at above moderate level now, payables ratio got slightly high
First Support Price	6.8
Second Support Price	6.5
Risk Rating	HIGH

Research House

AMMB Target Price	7.3 (2011-03-25)
HwangDBS Target Price	8.3 (2011-05-12)
MIDF Target Price	7.9 (2011-05-12)
RHB Target Price	8.47 (2011-07-11)
CIMB Target Price	5.75 (2011-08-19)
Kenanga Target Price	6.72 (2011-08-19)
OSK Target Price	6.93 (2011-08-19)
HLG Target Price	6.04 (2011-08-22)
Maybank Target Price	6.44 (2011-08-22)

Accounting Ratio

Return on Equity	0.52%
Dividend Yield	3.60%
Profit Margin	6.67%
Tax Rate	6.38%
Asset Turnover	0.3099
Net Asset Value Per Share	4.94
Net Tangible Asset per share	4.75
Price/Net Tangible Asset Per Share	1.54
Cash Per Share	0.76
Liquidity Current Ratio	1.2615
Liquidity Quick Ratio	1.1866
Liquidity Cash Ratio	0.6229
Gearing Debt to Equity Ratio	0.7113
Gearing Debt to Asset Ratio	0.4028
Working capital per thousand Ringgit sale	11.8%
Days to sell the inventory	13
Days to collect the receivables	91
Days to pay the payables	122

My notes based on 2011 quarter 5 report (number in '000):-
- Compared to FY11Q1, the lower revenue for the current quarter was mainly due to lower revenue in Heavy Engineering and Liner businesses. Higher revenue in Chemical and Offshore businesses helped to cushion the impact of revenue reduction in Heavy Engineering and Liner businesses. The decrease in profit was mainly due to losses in Petroleum business from weakening of freight rates and higher losses in Liner business from lower liftings

- Compared to FY11Q4, the increase in revenue were mainly due to higher revenue in Petroleum and Offshore businesses. pbt(excluding gains and impairment provisions for ships, loans and investments) of RM200.6 million was 17.2% higher than the RM171.2 million in the preceding quarter. The higher profit in this quarter was contributed mainly by lower losses in Petroleum business from reduced operating costs

- Estimate next 4Q eps after 2011 Q5 result announced = 0.3(roe ~6% per year due to an improvement from preceding quarter), estimate PE on current price 6.95 = 22.33(DPS 0.25)
- Estimate next 4Q eps after 2011 Q3 result announced = 0.05*4 = 0.2, estimate highest/lowest PE = 39.2/34.35 (DPS 0.35)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.0691*4 = 0.2764(profit margin 10% per quarter), estimate highest/lowest PE = 30.57/25.69 (DPS 0.35)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.04(exclude 257 million from other income)*4*1.05 = 0.168, estimate highest/lowest PE = 52.08/48.63 (DPS 0.35)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0509*4 = 0.2036, estimate highest/lowest PE = 42.98/37.77 (DPS 0.35)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0457*4 = 0.1828, estimate highest/lowest PE = 48.03/40.65 (DPS 0.35)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0457*4 = 0.1828, estimate highest/lowest PE = 47.37/40.59 (DPS 0.35)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0544*4 = 0.2176, estimate highest/lowest PE = 42/37.91 (DPS 0.35)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.058*4 = 0.232, estimate highest/lowest PE = 37.07/33.62 (DPS 0.35)

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