KLCI Stock - CSCSTEL / 5094 - 2010 Quarter 2

Company Info

Market Capital (Capital Size)	551,000,000 (Medium)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(1.45-0.1)/0.1186 = 11.38 (High)
Target Price	1.19+0.1 = 1.29 (PE 10.0, EPS 0.1186, DPS 0.1)
Decision	Not interested unless profit increase more
Comment	Revenue decreased 2.6% and also lower than preceding year corresponding quarter 0.5%, eps decreased 73.6% and also lower than preceding year corresponding quarter 79.9%, no cash generated from operating after deduct the expenses for inventories and receivables, spent 7.4% of Group cash to cover all expenses, weaker liquidity ratio but still at very strong level now, higher gearing ratio but still at low level now, all accounting ratio are good, affecting by raw materials increased sharply
First Support Price	1.4
Second Support Price	1.3
Risk Rating	HIGH

Research House

OSK Target Price	1.78 (2011-08-15)
HLG Target Price	1.62 (2011-08-16)

Accounting Ratio

Return on Equity	4.81%
Dividend Yield	8.97%
Profit Margin	2.76%
Tax Rate	23.27%
Asset Turnover	1.1831
Net Asset Value Per Share	2.07
Net Tangible Asset per share	2.07
Price/Net Tangible Asset Per Share	0.74
Cash Per Share	0.72
Liquidity Current Ratio	7.0655
Liquidity Quick Ratio	4.6865
Liquidity Cash Ratio	3.1611
Gearing Debt to Equity Ratio	0.1597
Gearing Debt to Asset Ratio	0.1377
Working capital per thousand Ringgit sale	48.8%
Days to sell the inventory	76
Days to collect the receivables	45
Days to pay the payables	32

My notes based on 2011 quarter 2 report (number in '000):-
- The small decrease in revenue is due to decreases in selling prices of our steel products albeit at higher sales volume. The significant drop in profit before tax is due to lower selling prices of our steel products coupled with significantly higher raw material cost

- Estimate next 4Q eps after 2011 Q2 result announced = 0.1483*0.8 = 0.1186, estimate PE on current price 1.45 = 11.38(DPS 0.1)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.1483, estimate highest/lowest PE = 11.13/8.56 (DPS 0.13)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.1854*0.8 = 0.1483, estimate highest/lowest PE = 11.4/10.32 (DPS 0.13)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.18*0.9 = 0.162, estimate highest/lowest PE = 10.19/9.57 (DPS 0.14)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.2936*0.9 = 0.2642 (10% decrease due to global steel price decreasing), estimate highest/lowest PE = 6.55/5.6 (DPS 0.2)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.2936 (maintained forecast eps due to lower margin), estimate highest/lowest PE = 5.99/4.67 (DPS 0.2)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.2936 (20% growth from 0.2442, world steel price increasing), estimate highest/lowest PE = 6.13/4.6 (DPS 0.2)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.24, estimate highest/lowest PE = 6.42/4.92 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.1012, estimate highest/lowest PE = 13.83/9.88 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.0612, estimate highest/lowest PE = 18.3/15.44

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