KLCI Stock - ZHULIAN / 5131 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	777,400,000 (Medium)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(1.69-0.12)/0.2169 = 7.24 (Moderate)
Target Price	1.95+0.12 = 2.07 (PE 9.0, EPS 0.2169, DPS 0.12)
Decision	BUY if stock price next uptrend start above 1.65
Comment	Revenue decreased 1% but higher than preceding year corresponding quarter 24.9%, eps increased 15.8% and also higher than preceding year corresponding quarter 22.7%, cash generated from operating enough to cover all expenses, weaker liquidity ratio from strong to high level now, slightly higher gearing ratio at low level now, all accounting ratio are good, higher inventory can indicate higher demand of products, benefit from stregthening of USD dollar against Ringgit
First Support Price	1.65
Second Support Price	1.55
Risk Rating	MODERATE

Research House

HwangDBS Target Price	2.5 (2011-02-09)
ZJ Target Price	2.18 (2011-10-21)

Accounting Ratio

Return on Equity	24.77%
Dividend Yield	7.10%
Profit Margin	32.43%
Tax Rate	18.30%
Asset Turnover	0.8004
Net Asset Value Per Share	0.82
Net Tangible Asset per share	0.82
Price/Net Tangible Asset Per Share	2.02
Cash Per Share	0.29
Liquidity Current Ratio	3.7773
Liquidity Quick Ratio	3.0652
Liquidity Cash Ratio	2.0947
Gearing Debt to Equity Ratio	0.1798
Gearing Debt to Asset Ratio	0.1524
Working capital per thousand Ringgit sale	50.5%
Days to sell the inventory	60
Days to collect the receivables	61
Days to pay the payables	80

My notes based on 2011 quarter 3 report (number in '000):-
- Lower revenue than FY11Q2 mainly due to a slight drop in the overseas market demands, offset by increase in local market demand but got higher pbt mainly contributed by increased profit of equity accounted investee during the third quarter whereas there were more meetings, seminars and incentive tour campaigns held during the immediate preceding quarter

- Estimate next 4Q eps after 2011 Q3 result announced = (0.0529+0.0457)*2*1.1 = 0.2169, estimate PE on current price 1.69 = 7.24(DPS 0.12)
- Estimate next 4Q eps after 2011 Q2 result announced = (0.0457+0.0478)*2*1.05 = 0.1964, estimate highest/lowest PE = 8.55/7.03 (DPS 0.12)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0478*4 = 0.1912, estimate highest/lowest PE = 8.73/8.16 (DPS 0.12)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0959*2*1.05 = 0.2014, estimate highest/lowest PE = 8.44/7.6 (DPS 0.12)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0431*4*1.1 = 0.1896, estimate highest/lowest PE = 9.39/8.33 (DPS 0.12)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0522*4*1.1 = 0.2297, estimate highest/lowest PE = 8.66/7.23 (DPS 0.14)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.072*4 = 0.288, estimate highest/lowest PE = 9.76/7.47 (DPS 0.14)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0715*4 = 0.286, estimate highest/lowest PE = 7.66/5.84 (DPS 0.14)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.069*4 = 0.276, estimate highest/lowest PE = 6.38/5.04 (DPS 0.12)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0484*4 = 0.1936, estimate highest/lowest PE = 9.35/6.56 (DPS 0.12)

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