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Wednesday, June 1, 2011

KLCI Stock - GENM / 4715 - 2011 Quarter 1

Company Info
Market Capital (Capital Size)21,365,816,219 (Very Large)
Par ValueRM 0.10

My Analysis
Forecast P/E now(3.61-0.08)/0.2944 = 11.99 (Moderate)
Target Price4.71+0.08 = 4.79 (PE 16.0, EPS 0.2944, DPS 0.08)
DecisionBUY
Comment
Revenue increased 25.2% and is second consecutive quarter increasing and also higher than preceding year corresponding quarter 45%, eps increased 15.4% and is second consecutive quarter increasing and also higher than preceding year corresponding quarter 54.3%, cash generated from operating is more than enough to cover all expenses, stronger liquidity ratio at moderate level now, higher gearing ratio at below moderate level now, all accounting turnover periods are good, casino UK profit largely increased, Resort World New York expected to open in the second half of 2011
First Support Price3.5
Second Support Price3.3
Risk RatingLOW

Research House
Credit Suisse Target Price3.3 (2011-01-14)
CIMB Target Price4.3 (2011-02-07)
RHB Target Price4.45 (2011-02-24)
AMMB Target Price3.85 (2011-03-16)
Macquarie Target Price4.25 (2011-04-06)
ECM Target Price3.42 (2011-05-27)
Maybank Target Price3.52 (2011-05-27)
MIMB Target Price4.26 (2011-05-27)
OSK Target Price4.1 (2011-05-30)

Accounting Ratio
Return on Equity12.75%
Dividend Yield2.22%
Profit Margin28.38%
Tax Rate24.53%
Asset Turnover0.3973
Net Asset Value Per Share2.06
Net Tangible Asset per share1.51
Price/Net Tangible Asset Per Share2.33
Cash Per Share0.74
Liquidity Current Ratio2.5584
Liquidity Quick Ratio2.5208
Liquidity Cash Ratio2.1895
Gearing Debt to Equity Ratio0.2791
Gearing Debt to Asset Ratio0.2182
Working capital per thousand Ringgit sale50.5%
Days to sell the inventory6
Days to collect the receivables38
Days to pay the payables94

My notes based on 2011 quarter 1 report (number in '000):-
- Higher pbt mainly due to the following:
1. profit from the casino business in the UK
2. the construction profit of RM13.4 million generated from the progressive development of the facility at Resorts World New York
3. lower pre-operating expenses incurred for the development and operations of a video lottery facility at Resorts World New York by RM4.2 million

- However, the higher profit before taxation was offset by lower profit from the leisure and hospitality business in Malaysia which was mainly due to lower business volume and weaker luck factor from the premium players business

- Estimate next 4Q eps after 2010 Q1 result announced = 0.0736*4 = 0.2944, estimate PE on current price 3.61 = 11.99(DPS 0.08)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.2241*1.1 = 0.2465, estimate highest/lowest PE = 15.26/12.74 (DPS 0.08)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0591*4 = 0.2364, estimate highest/lowest PE = 15.15/13.16 (DPS 0.079)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.2315*1.05 = 0.2431, estimate highest/lowest PE = 14.98/11.85 (DPS 0.079)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.2315*1.05 = 0.2431, estimate highest/lowest PE = 12.66/9.82 (DPS 0.073)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0628*4 = 0.2512, estimate highest/lowest PE = 11.25/9.7 (DPS 0.073)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0629*4 = 0.2516, estimate highest/lowest PE = 11.45/10.33 (DPS 0.07)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0577*4 = 0.2308, estimate highest/lowest PE = 12.35/11.44 (DPS 0.07)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.0481*4 = 0.1924, estimate highest/lowest PE = 15.23/12.79 (DPS 0.07)

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