KLCI Stock - ANNJOO / 6556 - 2010 Quarter 1

Market Cap : 522707278*2.88 = 1,505,396,960.64 (Moderate)
NTA per share : (946621-8981)/763784 = 1.23
P/BV : 2.88/1.23 = 2.34 (High)
Forecast P/E now : (2.88-0.03)/0.2364 = 12.06 (Moderate)
ROE : 13.16% (Moderate)
DY : 0.03/2.88*100 = 1.04% (Low)
Fixed Asset Turnover(3 year) : (0.7627+0.8571+1.2266)/3 = 0.9488 (Moderate)
Liquidity Ratio : 1108215/998708 = 1.1096 (Low)
Receivables Collection Period : (196007+149138)/2/(1556825/365) = 40 days (Good)
My Target Price : 2.6+0.03 = 2.63 (PE 11, EPS 0.2364, DPS 0.03)
My Decision : NOT BUY (unless price below 2.7)
My Comment : Revenue growing, good cash flow, high debt, navps increasing, steel prices increasing
Technical Support Price : 2.78, 2.65
Risk Rating : MODERATE
OSK Target Price : 2.75 (29 Apr 10)

My notes based on 2010 quarter 1 report (number in '000):
- During the quarter under review, the Group recorded revenue of RM 473.95 million, representing an increase by 115% as compared to the corresponding quarter of the preceding year. The increase in revenue was mainly due to higher steel prices and a strong rebound in sales tonnage by more than double which were boosted by the economic growth and accelerated steel consumption in both local and international market
- The Group achieved a profit before tax of 213% higher as compared to a loss before tax for the corresponding quarter of the preceding year. The Group’s significant improvement in profitability was primarily driven by strong recovery in demand and higher productivity as compared to the loss position which was affected by depressed steel prices and higher overhead expenses necessarily incurred during the plant shutdown for upgrading works in the corresponding quarter of the preceding year
- The Group recorded 71% higher revenue compared to the revenue of the preceding quarter. The Group registered a higher PBT, mainly due to significantly higher sales tonnages and rising selling prices of various steel products in local and export markets during the quarter
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0591*4 = 0.2364, estimate PE on current price 2.88 = 12.06(DPS 0.03)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.048*4 = 0.192, estimate highest/lowest PE = 15.68/13.54 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0682*4 = 0.2728, estimate highest/lowest PE = 12.17/8.69 (DPS 0.03)

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