KLCI Stock - HSPLANT / 5138 - 2010 Quarter 2

Market Cap : 800000000*2.37 = 1,896,000,000 (Large)
NTA per share : 1712867/799991 = 2.14
P/BV : 2.37/2.14 = 1.1075
Forecast P/E now : (2.37-0.11)/0.1998 = 11.31 (Moderate)
ROE : 8.05% (Low)
DY : 0.11/2.37*100 = 4.64% (Moderate)
Fixed Asset Turnover(3 year) : (0.2041+0.1992+0.1983)/3 = 0.2005 (Low)
Liquidity Ratio : 105498/69681 = 1.514 (Low)
Receivables Collection Period : (8985+13134)/2/(409432/365) = 9 days (Good)
My Target Price : 2.4+0.11 = 2.51 (PE 12, EPS 0.1998, DPS 0.11)
My Decision : NOT BUY unless price below 2.3
My Comment : Revenue and profit increased compared to previous year, good cash flow, low debt and decreasing, navps slightly decreased, monthly production increased, CPO price increasing
Technical Support Price : 2.2
Risk Rating : MODERATE

My notes based on 2010 quarter 2 report (number in '000):-

- Revenue for the current quarter under review was 9% higher than the preceding year corresponding quarter with higher sales volume of Crude Palm Oil (CPO) and higher average selling prices of CPO and Palm Kernel (PK). Group profit before tax [“PBT”] and profit after tax [“PAT”] for the current quarter were higher than the preceding year corresponding quarter by 56% and 59% respectively

- During the current quarter, 34,235 tonnes of CPO and 6,871 tonnes of PK were sold as compared to 32,050 tonnes of CPO and 7,373 tonnes of PK in the preceding year corresponding quarter. Average selling price of CPO and PK realised for the current quarter were RM2,499 and RM1,455 per tonne which were higher than the preceding year corresponding quarter of RM2,468 and RM1,089 per tonne respectively

- Production costs for the current quarter were significantly lower than the preceding year corresponding quarter mainly due to lower fertilizers prices

- Overall, the Group PBT and PAT for the current financial year-to-date were higher than the preceding year corresponding period by 97% and 98% respectively

- Group profit before tax for the current quarter at RM48.9 million approximates that of the preceding quarter of RM49.0 million. Higher average selling prices were recorded in the current quarter but were offset by lower sales volume of CPO sold

- Estimate next 4Q eps after 2010 Q2 result announced = 0.0454*1.1*4 = 0.1998, estimate PE on current price 2.37 = 11.31(DPS 0.11)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0456*1.1*4 = 0.2006, estimate highest/lowest PE = 11.42/10.02 (DPS 0.09)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0396*4 = 0.1584, estimate highest/lowest PE = 15.4/12.31 (DPS 0.09)

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