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Saturday, May 12, 2012

KLCI Stock - PCHEM / 5183 - 2011 Quarter 7

Company Info 
Market Capital (Capital Size)52,320,000,000 (Very Large)
Par ValueRM 0.10

My Analysis 
Forecast P/E now(6.54-0.16)/0.4324 = 14.75 (Moderate)
Target Price6.92+0.16 = 7.08 (PE 16.0, EPS 0.4324, DPS 0.16)
DecisionNot interested unless break and uptrend above 6.75 or wait stock price below Bolinger lower band
Revenue decreased 15.8% but higher than preceding year corresponding quarter 0.2%, eps decreased 36% and also lower than preceding year corresponding quarter 21%, cash generated from operating and investing more than enough to cover all expenses, maintain high margin, slightly stronger liquidity ratio at moderate level now, lower gearing ratio at below moderate level now, lower debt ratio at healthy level now, all repayment period is good, higher inventory can indicate better demand of products
First Support Price6.5
Second Support Price6.3

Research House
JP Morgan Target Price7.8 (2011-03-09)
Credit Suisse Target Price8.5 (2011-04-05)
Affin Target Price7.5 (2011-10-17)
RHB Target Price6.72 (2011-12-12)
AMMB Target Price8.3 (2012-02-28)
MIDF Target Price6.1 (2012-02-28)
OSK Target Price9 (2012-02-28)
CIMB Target Price7.9 (2012-02-29)
Kenanga Target Price7.02 (2012-03-08)
HwangDBS Target Price5.9 (2012-03-15)
Maybank Target Price7.5 (2012-03-15)
ECM Target Price7.69 (2012-05-03)

Accounting Ratio 
Return on Equity12.12%
Dividend Yield2.45%
Gross Profit Margin34.38%
Operating Profit Margin28.46%
Net Profit Margin29.18%
Tax Rate27.48%
Asset Turnover0.5711
Net Asset Value Per Share2.51
Net Tangible Asset per share2.26
Price/Net Tangible Asset Per Share3.05
Cash Per Share1.17
Liquidity Current Ratio2.7667
Liquidity Quick Ratio2.4703
Liquidity Cash Ratio2.0738
Gearing Debt to Equity Ratio0.3395
Gearing Debt to Asset Ratio0.2396
Working capital per thousand Ringgit sale49.2%
Days to sell the inventory47
Days to collect the receivables38
Days to pay the payables69

Technical Analysis 
SMA 206.61 (Downtrend 21 days)
SMA 506.693 (Downtrend)
SMA 1006.618 (Uptrend)
SMA 2006.333 (Downtrend)
MACD (26d/12d)-0.039161 ( 0.000893 )
Signal (9)-0.038682 ( 0.00012 )
MACD Histogram0.000479 (Bearish trend 1 day)
Bolinger Upper Band6.774
Bolinger Lower Band6.446

My notes based on 2011 quarter 7 report (number in '000):-
- Higher revenue than FY11Q3 due to higher product prices and strengthening USD, which offset lower sales volumes and lower pbt due to lower contribution from our associates and jointly controlled entity as a result of lower production and full utilisation of tax benefits in one of the associate companies in the previous year

- Lower revenue and profit in Olefins and Derivatives segment due to lower sales volume with lower production and affected by the softening in certain product markets and power interruption at PETRONAS Chemicals Ethylene Sdn Bhd(FY11Q6)

- Higher revenue and profit in Fertilisers and Methanol segment than FY11Q3 due to improved plant utilisation rate and production volumes as the corresponding quarter was limited by rejuvenation work at fertiliser plant and water supply issues at methanol facility. Despite higher production, sales volume was lower with less trading activities

- Lower revenue and pbt in Fertilisers and Methanol segment than FY11Q6 due to drop in average product prices, lower volumes and constrained by gas supply limitations

- Estimate next 4Q eps after 2011 Q7 result announced = 21622000*0.16/8000000 = 0.4324, estimate PE on current price 6.54 = 14.75(DPS 0.16)
- Estimate next 4Q eps after 2011 Q6 result announced = (0.0921+0.1436)*2*1.1 = 0.5185, estimate highest/lowest PE = 13.19/10.82 (DPS 0.19)
- Estimate next 4Q eps after 2011 Q5 result announced = (0.0921+0.105)*2*0.95 = 0.3745, estimate highest/lowest PE = 16.85/13.46 (DPS 0.19)
- Estimate next 4Q eps after 2011 Q4 result announced = 0.1165*4 = 0.466, estimate highest/lowest PE = 15.15/12.45 (DPS 0.19)

- Yearly net eps, 2008 = 0.491, 2009 = 0.352, 2010 = 0.275

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