KLCI Stock - IJM / 3336 - 2011 Quarter 1

Market Cap : 1350967417*5.04 = 6,808,875,781.68 (Very Large)
NTA per share : (4943068-75422)/1359772 = 3.58
P/BV : 5.04/3.58 = 1.4078
Forecast P/E now : (5.04-0.11)/0.278 = 17.73 (High)
ROE : 5.38% (Low)
DY : 0.11/5.04*100 = 2.18% (Low)
Fixed Asset Turnover(3 year) : (0.3095+0.3717+0.4172)/3 = 0.3661 (Low)
Liquidity Ratio : 5778428/2380870 = 2.427 (Moderate)
Receivables Collection Period : (1862366+2249298)/2/(3837968/365) = 195 days
My Target Price : 5+0.11 = 5.11 (PE 18, EPS 0.278, DPS 0.11)
My Decision : NOT BUY unless price below 4.7
My Comment : Revenue increased, profit before tax increasing, good cash flow, above moderate debt and slightly increased, navps decreased, CPO price increasing, expect more construction job come, price strong support at 4.2
Technical Support Price : 4.6
Risk Rating : MODERATE
OSK Target Price : 5.2 (26 Aug 10)

My notes based on 2011 quarter 1 report (number in '000):-

- The Group recorded a decline of 15.1% in operating revenues over the corresponding quarter of the preceding year, attributable mainly to the Construction Division. Whilst construction works at new major projects such as the Grand Hyatt in Kuala Lumpur and new India projects are expected to go full-swing later in the current financial year, the delays in some of the works of overseas projects and the substantial completion of major construction projects in the 4th quarter of the last financial year were the primary contributory factors towards the decline. Additionally lower selling prices and deliveries of building materials also resulted in the Group’s Industry division reporting a 19.8% decline in revenue

- On the other hand, the Group’s operating profit before tax for the current quarter rose by 44.6% compared to the preceding year’s corresponding quarter as the Group’s Property, Plantation and Infrastructure divisions reported higher profits following increased property sales, higher crude palm oil prices and added contribution from the Group’s 20%-owned Gautami Power Plant in India that was commissioned in June 2009 respectively

- The Group recorded a 13.8% growth in operating revenue mainly attributable to higher property sales while pre-tax profit increased by 10.0% with higher margins recorded in the Group’s Property and Plantation divisions

- Estimate next 4Q eps after 2011 Q1 result announced = 0.0662*4*1.05 = 0.278, estimate PE on current price 5.04 = 17.73(DPS 0.11)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.2484*0.9 = 0.2236 (10% drop, exclude foreign exchange gained), estimate highest/lowest PE = 22.58/19.5 (DPS 0.11)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0621*4 = 0.2484 (expecting revenue and profit recover hence no decrease on eps), estimate highest/lowest PE = 20.53/17.43 (DPS 0.05)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.2556, estimate highest/lowest PE = 19.13/16.55 (DPS 0.05)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.271, estimate highest/lowest PE = 25.13/15.68 (DPS 0.05)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.3251, estimate highest/lowest PE = 19.53/16.15 (DPS 0.05)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.2612, estimate highest/lowest PE = 21.06/12.44 (DPS 0.25)

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