KLCI Stock - SAPCRES / 8575 - 2011 Quarter 2

Market Cap : 1276722448*2.53 = 3,230,107,793.44 (Large)
NTA per share : (1046604-149213)/1276722 = 0.7
P/BV : 2.53/0.7 = 3.6143
Forecast P/E now : (2.53-0.07)/0.1751 = 14.05 (High)
ROE : 13.73% (Moderate)
DY : 0.07/2.53*100 = 2.77% (Low)
Fixed Asset Turnover(3 year) : (0.8573+0.9048+0.8571)/3 = 0.8731 (Moderate)
Liquidity Ratio : 2329774/1769919 = 1.3163 (Low)
Receivables Collection Period : (1557758+1813516)/2/(3077968/365) = 199 days (Long)
My Target Price : 2.8+0.07 = 2.87 (PE 16, EPS 0.1751, DPS 0.07)
My Decision : BUY
My Comment : Revenue and profit increasing, strong cash, high debt and increasing, receivables increasing, oil price above $80 but gas price decreasing
Technical Support Price : 1.9
Risk Rating : MODERATE
ECM Target Price : 2.64

My notes based on 2011 quarter 2 report (number in '000):

- Revenue increased by 34% from preceding quarter mainly due to higher revenue from the Installation of Pipeline and Facilities (“IPF”), drilling and operation and maintenance divisions

- Profit before tax increased by 14.3% from previous quarter mainly due to higher contribution from the drilling division

- Revenue for the current quarter was 12.9% lower compared to last year's corresponding quarter mainly due to lower activities in the IPF, marine services and operations and maintenance divisions

- Profit before tax was an increase of 4.6% compared to the preceding year’s corresponding quarter mainly due to higher contribution from IPF activities and the drilling division

- Estimate next 4Q eps after 2011 Q2 result announced = 0.0417*4*1.05 = 0.1751, estimate PE on current price 2.53 = 14.05(DPS 0.07)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.1345(maintain same eps as year 2010 due to revenue decreased but profit increased), estimate highest/lowest PE = 17.77/15.54 (DPS 0.07)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.1345*0.95 = 0.1278, estimate highest/lowest PE = 19.09/14.08 (DPS 0.07)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0422*4*0.8 = 0.135, estimate highest/lowest PE = 18.67/15.48 (DPS 0.06)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0414*4*0.9 = 0.149, estimate highest/lowest PE = 16.71/11.01 (DPS 0.06)

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