KLCI Stock - MMCCORP / 2194 - 2011 Quarter 2

Company Info

Market Capital (Capital Size)	7,612,646,380 (Very Large)
Par Value	RM 0.10

My Analysis

Forecast P/E now	(2.5-0.035)/0.1043 = 23.63 (High)
Target Price	1.88+0.035 = 1.91 (PE 18.0, EPS 0.1043, DPS 0.035)
Decision	Not interested unless stock price sustain above 2.7
Comment	Revenue increased 8.7% and also higher than preceding year corresponding quarter 4.9%, eps increased 90.8% but lower than preceding year corresponding quarter 8.2%, cash generated from operating and investing just enough to cover all expenses, slightly higher liquidity ratio at low level now, slightly lower gearing ratio at very high ratio now, all accounting ratio are good, construction division continue loss and other divisions also recorded lower profit
First Support Price	2.5
Second Support Price	2.3
Risk Rating	MODERATE

Research House

Kenanga Target Price	3.16 (2011-06-14)
OSK Target Price	3.58 (2011-08-17)
HwangDBS Target Price	3.7 (2011-08-24)

Accounting Ratio

Return on Equity	3.34%
Dividend Yield	1.40%
Profit Margin	11.07%
Tax Rate	16.87%
Asset Turnover	0.2558
Net Asset Value Per Share	2.18
Net Tangible Asset per share	-0.37
Price/Net Tangible Asset Per Share	-7.24
Cash Per Share	1.38
Liquidity Current Ratio	1.4758
Liquidity Quick Ratio	1.337
Liquidity Cash Ratio	0.8133
Gearing Debt to Equity Ratio	3.7959
Gearing Debt to Asset Ratio	0.706
Working capital per thousand Ringgit sale	27.0%
Days to sell the inventory	37
Days to collect the receivables	96
Days to pay the payables	100

My notes based on 2011 quarter 2 report (number in '000):-
- Higher profit recorded from Energy & Utilities division due to higher volume of gas sold, lower other operating expenses, improved associates performance and lower finance cost as a result of loan repayments

- Higher profit recorded from Transport & Logistics division mainly driven by the increase in tonnage and throughput volume coupled with lower operating costs

- Better performance from the Engineering & Construction division mainly due to the absence of profit revisions for the double track project and lower provision on project losses of Zelan Berhad

- Lower contribution from Corporate & Others division due to lower gain on disposal of investment coupled with higher finance cost

- Estimate next 4Q eps after 2011 Q2 result announced = (0.0269*3+0.0141)*1.1 = 0.1043, estimate PE on current price 2.5 = 23.63(DPS 0.035)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.1133*1.05 = 0.119, estimate highest/lowest PE = 24.08/18.61 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.1133, estimate highest/lowest PE = 25.99/22.29 (DPS 0.035)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0676*2*1.1 = 0.1487, estimate highest/lowest PE = 21.45/17.82 (DPS 0.03)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0402*2*1.1 = 0.0884, estimate highest/lowest PE = 37.56/27.94 (DPS 0.03)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0777*1.1 = 0.0855, estimate highest/lowest PE = 31.23/25.73 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0777*1.1 = 0.0855, estimate highest/lowest PE = 29.82/25.38 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0297*4*0.9 = 0.1069, estimate highest/lowest PE = 23.43/20.63 (DPS 0.025)

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