KLCI Stock - BAT / 4162 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	13,162,933,000 (Very Large)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(46.1-2.73)/2.6506 = 16.36 (Moderate)
Target Price	45.06+2.73 = 47.79 (PE 17.0, EPS 2.6506, DPS 2.73)
Decision	BUY if for dividend keep
Comment	Revenue increased 5.9% and was third consecutive quarter increasing and also higher than preceding year corresponding quarter 11.2%, eps decreased 4.3% but higher than preceding year corresponding quarter 3.3%, cash generated from operating not enough to cover financing expenses hence spent 10.7% of Group cash to cover, weaker liquidity ratio from low to weak level now, higher gearing ratio at very high level now, all accounting ratio are good, lower inventory can indicate slow down of sales
First Support Price	45.0
Second Support Price	43.0
Risk Rating	MODERATE

Research House

MIDF Target Price	44.84 (2011-04-22)
Kenanga Target Price	42.2 (2011-07-22)
TA Target Price	48.3 (2011-07-22)
OSK Target Price	43.41 (2011-09-15)
RHB Target Price	42.4 (2011-10-19)
AMMB Target Price	45.9 (2011-10-21)
CIMB Target Price	44.9 (2011-10-21)
ECM Target Price	43.8 (2011-10-21)
Maybank Target Price	45.1 (2011-10-21)

Accounting Ratio

Return on Equity	164.39%
Dividend Yield	5.92%
Profit Margin	21.67%
Tax Rate	26.34%
Asset Turnover	2.6575
Net Asset Value Per Share	1.48
Net Tangible Asset per share	0.04
Price/Net Tangible Asset Per Share	1090.0
Cash Per Share	1.12
Liquidity Current Ratio	0.8828
Liquidity Quick Ratio	0.6421
Liquidity Cash Ratio	0.3877
Gearing Debt to Equity Ratio	2.6385
Gearing Debt to Asset Ratio	0.7252
Working capital per thousand Ringgit sale	-2.3%
Days to sell the inventory	23
Days to collect the receivables	18
Days to pay the payables	40

My notes based on 2011 quarter 3 report (number in '000):-
- Lower pat than FY11Q2 due to increase in operating expenses from one off costs for change in distribution model and higher effective tax rate

- Estimate next 4Q eps after 2011 Q3 result announced = (0.6173+0.6449)*2*1.05 = 2.6506, estimate PE on current price 46.1 = 16.36(DPS 2.73)
- Estimate next 4Q eps after 2011 Q2 result announced = 1.2703*2 = 2.5406, estimate highest/lowest PE = 17.43/15.74 (DPS 2.7)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.6254*4 = 2.5016, estimate highest/lowest PE = 18.43/17.2 (DPS 2.4)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.5977*4*0.95 = 2.2713, estimate highest/lowest PE = 20.36/18.67 (DPS 2.41)
- Estimate next 4Q eps after 2010 Q2 result announced = 2.4323(7% drop from 2.6154), estimate highest/lowest PE = 19.56/16.8 (DPS 2.36)
- Estimate next 4Q eps after 2010 Q1 result announced = 2.4323(7% drop from 2.6154), estimate highest/lowest PE = 17.53/16.31 (DPS 2.36)
- Estimate next 4Q eps after 2009 Q4 result announced = 2.4323, estimate highest/lowest PE = 17.82/16.06 (DPS 2.36)
- Estimate next 4Q eps after 2009 Q3 result announced = 2.4323, estimate highest/lowest PE = 17.99/16.1 (DPS 2.35)
- Estimate next 4Q eps after 2009 Q2 result announced = 2.8448, estimate highest/lowest PE = 16.36/14.54 (DPS 2.65)

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