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Monday, December 5, 2011

KLCI Stock - WCT / 9679 - 2011 Quarter 3

Company Info
Listing Date1995-02-16
Market Capital (Capital Size)1,731,131,418 (Large)
Par ValueRM 0.50
BoardMain
SectorConstruction
Major IndustryCivil Engineering
Sub IndustryInfrastructure Construction
Websitehttp://www.wct.com.my

My Analysis
Forecast P/E now(2.15-0.1)/0.1852 = 11.07 (Moderate)
Target Price2.96+0.1 = 3.06 (PE 16.0, EPS 0.1852, DPS 0.1)
DecisionBUY if stock price sustain and next uptrend start above 2.14
Comment
Revenue decreased 3.7% but higher than preceding year corresponding quarter 1.4%, eps increased 5.2% and was second consecutive quarter increasing and also higher than preceding year corresponding quarter 20.6%, cash generated from operating and financing not enough to cover financing expenses hence spent 12.4% of Group cash to cover, weaker liquidity ratio at low level now, lower gearing ratio but still at high level now, receivables and payables ratio slightly high, lower inventory can indicate construction works lesser
First Support Price2.14
Second Support Price1.9
Risk RatingMODERATE

Research House
MIDF Target Price3.5 (2011-05-30)
OSK Target Price3.69 (2011-05-30)
AMMB Target Price3.85 (2011-07-29)
HwangDBS Target Price4.15 (2011-09-14)
UOB Target Price2.37 (2011-09-23)
RHB Target Price2.08 (2011-10-21)
CIMB Target Price3.2 (2011-11-18)
HLG Target Price2.98 (2011-11-21)
Maybank Target Price2.75 (2011-11-21)

Accounting Ratio
Return on Equity9.41%
Dividend Yield4.65%
Profit Margin14.64%
Tax Rate22.69%
Asset Turnover0.3408
Net Asset Value Per Share1.69
Net Tangible Asset per share1.69
Price/Net Tangible Asset Per Share1.41
Cash Per Share1.27
Liquidity Current Ratio1.6936
Liquidity Quick Ratio1.4971
Liquidity Cash Ratio0.7875
Gearing Debt to Equity Ratio1.8634
Gearing Debt to Asset Ratio0.6079
Working capital per thousand Ringgit sale63.5%
Days to sell the inventory78
Days to collect the receivables237
Days to pay the payables260

My notes based on 2011 quarter 3 report (number in '000):-
- Estimate next 4Q eps after 2011 Q3 result announced = 0.0463*4 = 0.1852, estimate PE on current price 2.15 = 11.07(DPS 0.1)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.044*4*1.02 = 0.1795, estimate highest/lowest PE = 15.65/9.75 (DPS 0.1)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.1699*0.95 = 0.1614, estimate highest/lowest PE = 19.44/14.99 (DPS 0.1)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0809*2*1.05 = 0.1699(offset higher profit from property investment due to profit from this segment usually not maintaining), estimate highest/lowest PE = 17.95/16.01 (DPS 0.1)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0809*2*1.05 = 0.1699, estimate highest/lowest PE = 20.78/16.24 (DPS 0.1)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.1703*1.1 = 0.1873, estimate highest/lowest PE = 17.14/14.26 (DPS 0.1)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0441*4*0.9 = 0.1588, estimate highest/lowest PE = 17.51/14.67 (DPS 0.1)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.16, estimate highest/lowest PE = 18.88/15.13 (DPS 0.1)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.16, estimate highest/lowest PE = 16.94/13.75 (DPS 0.1)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0535*4 = 0.214, estimate highest/lowest PE = 12.85/11.07 (DPS 0.1)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.05*4 = 0.2, estimate highest/lowest PE = 13.83/8.48 (DPS 0.095, economy crisis)

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