KLCI Stock - P&O / 6009 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	177,049,440 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(0.72-0.056)/0.1539 = 4.31 (Moderate)
Target Price	1.23+0.056 = 1.29 (PE 8.0, EPS 0.1539, DPS 0.056)
Decision	BUY if stock price sustain above 0.7 and got stronger buy volume than sell
Comment	Revenue decreased 16% but higher than preceding year corresponding quarter 17.9%, eps increased 78.8% but lower than preceding year corresponding quarter 33.7%, no cash generated and largely over spent in operating activities but cash generated from financing enough to cover all expenses, stronger liquidity ratio at strong level now, better gearing ratio, higher reinsurance assets which should turn into higher revenue, insurance division recorded higher profit
First Support Price	0.7
Second Support Price	0.66
Risk Rating	MODERATE

Accounting Ratio

Return on Equity	22.63%
Dividend Yield	7.78%
Profit Margin	17.43%
Tax Rate	28.22%
Asset Turnover	0.4997
Net Asset Value Per Share	0.88
Net Tangible Asset per share	0.87
Price/Net Tangible Asset Per Share	0.87
Cash Per Share	2.51
Liquidity Current Ratio	5.9168
Liquidity Quick Ratio	4.8182
Liquidity Cash Ratio	4.0294
Gearing Debt to Equity Ratio	3.7859
Gearing Debt to Asset Ratio	0.7911
Working capital per thousand Ringgit sale	145.8%
Days to sell the inventory	140
Days to collect the receivables	85
Days to pay the payables	32

My notes based on 2011 quarter 3 report (number in '000):-
- Higher revenue than FY10Q3 mainly attributable to higher gross premium recorded by the insurance subsidiary and higher pbt mainly attributable to lower net claims incurred at the insurance subsidiary

- Lower revenue than FY11Q2 mainly attributable to lower gross premium recorded by the insurance subsidiary however higher pbt due mainly to lower net claims incurred at the insurance subsidiary

- Estimate next 4Q eps after 2011 Q3 result announced = (0.0368+0.0658)*2*0.75 = 0.1539, estimate PE on current price 0.72 = 4.31(DPS 0.056)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.0368*4*0.9 = 0.1325, estimate highest/lowest PE = 6.18/5.24 (DPS 0.006)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0277*4 = 0.1108(ROE 3.5% per quarter), estimate highest/lowest PE = 8.66/6.35 (DPS 0.006)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.05*4/2 = 0.1(ROE 3.5% per quarter), estimate highest/lowest PE = 9.6/7.7

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