KLCI Stock - NCB / 5509 - 2010 Quarter 3

Par Value: 1.00
Market Cap : 470252708*3.68 = 1,730,529,965.44 (Large)
NTA per share : (1894835-56809)/470253 = 3.91
P/BV : 3.68/3.91 = 0.9412
Forecast P/E now : (3.68-0.28)/0.3595 = 9.46 (Moderate)
ROE : 8.19% (Low)
DY : 0.28/3.68*100 = 7.61% (High)
Fixed Asset Turnover(4 year) : (0.4127+0.4087+0.4716+0.4458)/4 = 0.4347 (Low)
Liquidity Ratio : 1129955/198845 = 5.6826 (Strong)
Receivables Collection Period : (229158+174920)/2/(883394/365) = 83 days (Acceptable)
My Target Price : 3.4+0.28 = 3.68 (PE 10.5, EPS 0.3238, DPS 0.28)
My Decision : NOT BUY unless price below 3.5
My Comment : Revenue still high but slow down, profit increasing, good cash flow, strong cash, low debt but slightly increasing, navps increased, port operations profit increasing, haulage/logistics division reduced loss
Technical Support Price : 3.57
Risk Rating : LOW
OSK Target Price : 3.73 (26 Oct 10)

My notes based on 2010 quarter 3 report (number in '000):-

- The Group’s revenue for the current quarter is 1.5% higher than the corresponding comparative quarter’s. The port operating subsidiary contributed RM177.1 million while the haulage/logistics subsidiary contributed RM44.6 million. The increase in revenue for the current quarter was mainly due to increased business volume undertaken by the port operating subsidiary

- Northport achieved a throughput during the current quarter of 853,804 TEUs reflecting an increase of 12.3% as compared to the corresponding period last year of 760,279 TEUs. The year-to-date throughput achieved is 2,513,281 TEUs representing an increase of 22.0% compared against the corresponding period last year of 2,059,841 TEUs

- As for the haulage division in the haulage/logistics subsidiary the total volume handled during the quarter is 55,389 TEUs which is a decrease of 20.2% as compared to the figure for the corresponding quarter in 2009 of 69,469 TEUs. The year-to-date volume achieved is 177,077 TEUs representing a decrease of 9.8% compared to the figure for the corresponding period last year of 196,428 TEUs

- For the third quarter under review, the increase in volume handled by the port operating subsidiary was mainly due to recovery in the Malaysian economy as well as regional economies

- The profit before tax for the current quarter higher than the immediate preceding quarter’s profit before tax 8%. The increased profit figure was mainly due to the increase in revenue from the high volume of containers handled during the quarter

- Estimate next 4Q eps after 2010 Q3 result announced = 0.3408*0.95 = 0.3238, estimate PE on current price 3.68 = 9.46(DPS 0.28)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.1623*2*1.05 = 0.3408, estimate highest/lowest PE = 10.04/9.65 (DPS 0.28)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.3383(add adjustment of 0.0183), estimate highest/lowest PE = 10.4/8.34 (DPS 0.28)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.32(around 7% grow from 0.2999, expect improve in first half quarter, second half remain), estimate highest/lowest PE = 10.84/9.19 (DPS 0.28)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.3124, estimate highest/lowest PE = 9.57/8.8 (DPS 0.25)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.2617, estimate highest/lowest PE = 10.89/10.2 (DPS 0.25)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.2647, estimate highest/lowest PE = 10.96/9.03 (DPS 0.25)

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