KLCI Stock - LATEXX / 7064 - 2011 Quarter 2

Company Info

Market Capital (Capital Size)	381,055,835 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(1.71-0.05)/0.2428 = 6.84 (Moderate)
Target Price	2.43+0.05 = 2.48 (PE 10.0, EPS 0.2428, DPS 0.05)
Decision	watching, buy when sell volume not high
Comment	Revenue increased 41.8% but lower than preceding year corresponding quarter 0.1%, eps increased 39.3% and was second consecutive quarter increasing but lower than preceding year corresponding quarter 18.3%, cash generated from operating and financing more than enough to cover all expenses, weaker liquidity ratio at low level now, higher gearing ratio at above moderate level now, all accounting ratio are good, benefit from latex price decreasing but affect by increasing of nitrile price, profit continue affect by weakening of USD dollar, enlarging customer base to non-USA markets, aggressively penetrating into the non-medical markets
First Support Price	1.6
Second Support Price	1.45
Risk Rating	MODERATE

Research House

CIMB Target Price

2.6 (2011-06-09)

Accounting Ratio

Return on Equity	23.35%
Dividend Yield	1.46%
Profit Margin	15.20%
Tax Rate	13.80%
Asset Turnover	0.9957
Net Asset Value Per Share	1.02
Net Tangible Asset per share	0.95
Price/Net Tangible Asset Per Share	1.8
Cash Per Share	0.28
Liquidity Current Ratio	1.6809
Liquidity Quick Ratio	1.2487
Liquidity Cash Ratio	0.5728
Gearing Debt to Equity Ratio	0.7517
Gearing Debt to Asset Ratio	0.4291
Working capital per thousand Ringgit sale	18.8%
Days to sell the inventory	52
Days to collect the receivables	68
Days to pay the payables	79

My notes based on 2011 quarter 2 report (number in '000):-
- The decrease in the Group’s revenue and the net profit of the current year was mainly due to the persistently high raw material prices and the adverse foreign exchange rate over FY10Q2

- The growth in the current quarter compared to the preceding quarter was mainly spurred by higher sales volume due to stronger market demand

- Estimate next 4Q eps after 2011 Q2 result announced = (0.0483+0.0673)*2*1.05 = 0.2428, estimate PE on current price 1.71 = 6.84(DPS 0.05)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.0483*4*1.1 = 0.2125, estimate highest/lowest PE = 11.86/7.18 (DPS 0.075)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.2751*0.95 = 0.2613, estimate highest/lowest PE = 10.62/8.78 (DPS 0.075)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.3043*0.95 = 0.289, estimate highest/lowest PE = 9.91/8.15 (DPS 0.075)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0824*4 = 0.3296+0.012(QbQ improvement adjustment) = 0.3416, estimate highest/lowest PE = 10.47/6.72 (DPS 0.075)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0792*4 = 0.3168+0.02(QbQ improvement adjustment) = 0.3368, estimate highest/lowest PE = 11.46/9.62 (DPS 0.05)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0675*4 = 0.27+0.02(QbQ improvement adjustment) = 0.29, estimate highest/lowest PE = 14.62/12.14 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0566*4 = 0.2264, estimate highest/lowest PE = 21.78/10.42 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0586*4 = 0.2344, estimate highest/lowest PE = 11.99/7.81 (DPS 0.02)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.047*4 = 0.188, estimate highest/lowest PE = 10.37/4.2 (DPS 0.02)

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