KLCI Stock - ZHULIAN / 5131 - 2011 Quarter 2

Company Info

Market Capital (Capital Size)	805,000,000 (Medium)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(1.75-0.12)/0.1964 = 8.30 (Moderate)
Target Price	1.77+0.12 = 1.89 (PE 9.0, EPS 0.1964, DPS 0.12)
Decision	BUY
Comment	Revenue increased 7.5% and is third consecutive quarter increasing and also higher than preceding year corresponding quarter 19%, eps decreased 4.4% and is second consecutive quarter decreasing and also lower than preceding year corresponding quarter 12.5%, cash generated from operating not enough to cover financing expenses, stronger liquidity ratio at strong level now, lower gearing ratio at low level now, all accounting ratio are good, continuous affecting by weakeaning USD dollar against Ringgit
First Support Price	1.7
Second Support Price	1.62
Risk Rating	MODERATE

Research House

HwangDBS Target Price	2.5 (2011-02-09)
ZJ Target Price	2.18 (2011-04-22)

Accounting Ratio

Return on Equity	24.43%
Dividend Yield	6.86%
Profit Margin	25.53%
Tax Rate	11.20%
Asset Turnover	0.8036
Net Asset Value Per Share	0.8
Net Tangible Asset per share	0.79
Price/Net Tangible Asset Per Share	2.22
Cash Per Share	0.26
Liquidity Current Ratio	4.5686
Liquidity Quick Ratio	3.6583
Liquidity Cash Ratio	2.4107
Gearing Debt to Equity Ratio	0.1447
Gearing Debt to Asset Ratio	0.1264
Working capital per thousand Ringgit sale	53.0%
Days to sell the inventory	63
Days to collect the receivables	64
Days to pay the payables	65

My notes based on 2011 quarter 2 report (number in '000):-
- Lower pbt than FY11Q1 mainly due to the meetings, seminars and incentive tour campaigns held during the period

- Estimate next 4Q eps after 2011 Q2 result announced = (0.0457+0.0478)*2*1.05 = 0.1964, estimate PE on current price 1.75 = 8.3(DPS 0.12)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0478*4 = 0.1912, estimate highest/lowest PE = 8.73/8.16 (DPS 0.12)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0959*2*1.05 = 0.2014, estimate highest/lowest PE = 8.44/7.6 (DPS 0.12)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0431*4*1.1 = 0.1896, estimate highest/lowest PE = 9.39/8.33 (DPS 0.12)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0522*4*1.1 = 0.2297, estimate highest/lowest PE = 8.66/7.23 (DPS 0.14)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.072*4 = 0.288, estimate highest/lowest PE = 9.76/7.47 (DPS 0.14)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0715*4 = 0.286, estimate highest/lowest PE = 7.66/5.84 (DPS 0.14)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.069*4 = 0.276, estimate highest/lowest PE = 6.38/5.04 (DPS 0.12)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0484*4 = 0.1936, estimate highest/lowest PE = 9.35/6.56 (DPS 0.12)

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