KLCI Stock - DAYANG / 5141 - 2011 Quarter 1

Company Info

Market Capital (Capital Size)	1,138,500,000 (Large)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(2.07-0.1)/0.1699 = 11.60 (Moderate)
Target Price	2.21+0.1 = 2.31 (PE 13.0, EPS 0.1699, DPS 0.1)
Decision	BUY
Comment	Revenue increased 0.3% and is fifth consecutive quarter increasing(higher than preceding year corresponding quarter 93.6%), eps decreased 7.1% but higher than preceding year corresponding quarter 19.6%, cash generated from operating is right enough to cover all expenses and still got cash generated from financing activity, stronger liquidity ratio at strong level now, lower gearing ratio at below moderate level now, receivables and payables ratio quite high but offset by higher working capital
First Support Price	1.9
Second Support Price	1.7
Risk Rating	MODERATE

Research House

RHB Target Price	2.6 (2011-02-09)
HwangDBS Target Price	2.7 (2011-04-19)
ECM Target Price	2.04 (2011-05-25)
OSK Target Price	2.8 (2011-06-10)

Accounting Ratio

Return on Equity	18.55%
Dividend Yield	4.83%
Profit Margin	26.63%
Tax Rate	25.04%
Asset Turnover	0.4237
Net Asset Value Per Share	1.08
Net Tangible Asset per share	1.08
Price/Net Tangible Asset Per Share	1.85
Cash Per Share	0.69
Liquidity Current Ratio	4.5461
Liquidity Quick Ratio	4.5338
Liquidity Cash Ratio	3.1723
Gearing Debt to Equity Ratio	0.3687
Gearing Debt to Asset Ratio	0.2694
Working capital per thousand Ringgit sale	123.3%
Days to sell the inventory	2
Days to collect the receivables	172
Days to pay the payables	129

My notes based on 2011 quarter 1 report (number in '000):-
- Higher revenue mainly due to higher value of work orders received and performed in the current quarter

- Lower pbt due to the work orders in the current quarter have a lower profit margin contribution and the mobilisation costs of the new contract from Petronas Carigali Sdn Bhd for its Sarawak Operations

- The Group has on-going contracts exceeding RM1.5 billion to last at least until 2016

- The Group has commenced mobilisation for the new contract from Petronas Carigali Sdn Bhd for its Sarawak Operations beginning March 2011. The Group would see contributions from this new contract from the second quarter onwards

- Estimate next 4Q eps after 2011 Q1 result announced = 0.0354*4*1.2 = 0.1699, estimate PE on current price 2.07 = 11.6(DPS 0.05)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0326(17927/550000)*4*1.1 = 0.1434, estimate highest/lowest PE = 15.06/12.9 (DPS 0.05)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0526*4*1.1 = 0.2314, estimate highest/lowest PE = 13.22/12.14 (DPS 0.05)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.1239*1.1 = 0.1363 (0.1239 is recent 4Q cum_eps), estimate highest/lowest PE = 21.94/14.16 (DPS 0.05)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.129/4(average eps from recent 4Q)*0.9 = 0.1161 (10% drop year-to-year), estimate highest/lowest PE = 16.67/12.79 (DPS 0.05)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.1237*0.9 = 0.1113(10% drop year-to-year), estimate highest/lowest PE = 19.14/14.82 (DPS 0.05, correction to last Q estimated)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.1246, estimate highest/lowest PE = 16.21/9.71 (DPS 0.05)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.1548, estimate highest/lowest PE = 8.98/6.91 (DPS 0.07)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.1338, estimate highest/lowest PE = 8.67/3.73 (DPS 0.14)
- Estimate next 4Q eps after 2008 Q4 result announced = 0.15, estimate highest/lowest PE = 7.87/ (DPS 0.14)

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