KLCI Stock - MRCB / 1651 - 2011 Quarter 4

Company Info

Market Capital (Capital Size)	2,786,666,303 (Large)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(2.01-0.02)/0.0604 = 32.95 (High)
Target Price	1.75+0.02 = 1.77 (PE 29.0, EPS 0.0604, DPS 0.02)
Decision	Not interested unless stock price can strong uptrend above 2.1 or wait until another round of moving uptrend from a lower price point
Comment	Revenue increased 64.3% and was third consecutive quarter increasing and also higher than preceding year corresponding quarter 8.6%, eps increased 144.2% but lower than preceding year corresponding quarter 37.5%, not enough cash from operating activites and cash generated from financing activities and disposal also not enough to cover all expenses hence spent 23.8% of Group cash, weaker liquidity ratio from moderate to low level now, higher gearing ratio at very high level now, debt ratio increasing, cash decreasing, higher property development cost can indicate still good prospect from property development division
First Support Price	2.1
Second Support Price	2.0
Risk Rating	MODERATE

Research House

Kenanga Target Price	3.44 (2011-08-17)
UOB Target Price	2.57 (2011-10-03)
CIMB Target Price	1.9 (2011-11-24)
RHB Target Price	2.55 (2011-12-07)
MIDF Target Price	2.43 (2012-02-02)
OSK Target Price	2.5 (2012-02-09)
AMMB Target Price	2.3 (2012-02-10)
HLG Target Price	2.5 (2012-02-10)
HwangDBS Target Price	3.1 (2012-02-10)

Accounting Ratio

Return on Equity	5.54%
Dividend Yield	1.00%
Profit Margin	9.04%
Tax Rate	24.89%
Asset Turnover	0.2242
Net Asset Value Per Share	0.98
Net Tangible Asset per share	0.91
Price/Net Tangible Asset Per Share	2.46
Cash Per Share	0.45
Liquidity Current Ratio	1.4978
Liquidity Quick Ratio	1.2055
Liquidity Cash Ratio	0.4266
Gearing Debt to Equity Ratio	2.9504
Gearing Debt to Asset Ratio	0.7416
Working capital per thousand Ringgit sale	59.7%
Days to sell the inventory	139
Days to collect the receivables	338
Days to pay the payables	359

Technical Analysis

SMA 20	2.085 (Downtrend 11 days)
SMA 50	2.081 (Uptrend)
SMA 100	2.008 (Uptrend)
SMA 200	2.082 (Downtrend)
MACD (26d/12d)	-0.031292 ( 0.000976 )
Signal (9)	-0.020369 ( 0.002731 )
MACD Histogram	0.010923 (Bearish trend 15 days)

My notes based on 2011 quarter 4 report (number in '000):-
- Higher revenue due to on-going and encouraging strata offices sales from property development projects at KL Sentral

- Lower pbt than FY10Q4 was due to recognition of full cost for variation order claims of which recovery of the same are pending clients’ approval

- Estimate next 4Q eps after 2011 Q4 result announced = 1398254*0.06/1388264 = 0.0604(ROE 6%), estimate PE on current price 2.01 = 32.95(DPS 0.02)
- Estimate next 4Q eps after 2011 Q3 result announced = 0.0811, estimate highest/lowest PE = 27.81/23.37 (DPS 0.015)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.0811, estimate highest/lowest PE = 28.91/18.06 (DPS 0.015)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0156*4*1.3 = 0.0811, estimate highest/lowest PE = 31.87/24.11 (DPS 0.015)
- Estimate next 4Q eps after 2010 Q4 result announced = 1067579*1.3*0.09/1380582 = 0.0905(profit margin per 9%, revenue yearly increase rate 30%), estimate highest/lowest PE = 26.02/21.49 (DPS 0.015)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0188*4*1.1 = 0.0827(profit margin 8%, revenue increase rate 20%), estimate highest/lowest PE = 29.02/22.61 (DPS 0.01)
- Estimate next 5Q eps after 2010 Q2 result announced = 0.0129,0.0175,0.0202,0.0237,0.0313(calculation is based on receivables, revenue, 8% profit margin and 27% tax rate), exclude 0.0129 then cum_eps is 0.0927, estimate highest/lowest PE = 24.49/17.26 (DPS 0.01)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0743, estimate highest/lowest PE = 23.96/18.03 (DPS 0.01)

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