KLCI Stock - NOTION / 0083 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	282,847,321 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(1.83-0.06)/0.216 = 8.19 (Moderate)
Target Price	1.94+0.06 = 2.00 (PE 9.0, EPS 0.216, DPS 0.06)
Decision	Not interested unless stock price can sustain at 1.8
Comment	Revenue increased 12.9% and also higher than preceding year corresponding quarter 0.1%, eps decreased 6.4% and was second consecutive quarter decreasing but still higher than preceding year corresponding quarter 241.7%, cash generated from operating not enough to cover financing & investing activities hence still generate cash from financing activities but still spent 54% of Group cash, weaker liquidity but still at moderate level now, lower gearing ratio at moderate level now, all accounting ratio are good, consumer confidence for digital products seems to be affected by both the weak US and Euro zone economies
First Support Price	1.6
Second Support Price	1.45
Risk Rating	MODERATE

Research House

HwangDBS Target Price	2.5 (2011-01-24)
OSK Target Price	2.12 (2011-05-11)
RHB Target Price	2.1 (2011-08-02)
HLG Target Price	2.58 (2011-08-12)
Maybank Target Price	2.4 (2011-08-12)
ECM Target Price	2.43 (2011-08-15)

Accounting Ratio

Return on Equity	16.79%
Dividend Yield	4.10%
Profit Margin	21.57%
Tax Rate	22.47%
Asset Turnover	0.5818
Net Asset Value Per Share	1.66
Net Tangible Asset per share	1.66
Price/Net Tangible Asset Per Share	1.17
Cash Per Share	0.11
Liquidity Current Ratio	2.4096
Liquidity Quick Ratio	1.7023
Liquidity Cash Ratio	0.3028
Gearing Debt to Equity Ratio	0.5232
Gearing Debt to Asset Ratio	0.3424
Working capital per thousand Ringgit sale	33.9%
Days to sell the inventory	75
Days to collect the receivables	107
Days to pay the payables	44

My notes based on 2011 quarter 3 report (number in '000):-
- The lower PAT of about RM0.6 million is mainly attributable to higher costs and a weaker USD

- In Q3FY2011, HDD parts revenue recorded RM21.7 million (Q2FY2011: RM20.5 million), camera parts recorded RM29.2 million (Q2FY2011: RM24.4 million) whilst the industrial/automotive revenue was at RM9.9 million (Q2FY2011: RM9.0 million). The product mix for Q3FY2011 was HDD:Camera:Industrial/Automotive of 36%:48%:16% compared to previous quarter's mix of 38%:45%:17%

- Estimate next 4Q eps after 2011 Q3 result announced = 0.24*0.9 = 0.216, estimate PE on current price 1.83 = 8.19(DPS 0.06)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.24, estimate highest/lowest PE = 9.13/7.04 (DPS 0.06)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.06*4 = 0.24, estimate highest/lowest PE = 9.6/6.81 (DPS 0.045)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.0523*4*0.9 = 0.1883, estimate highest/lowest PE = 11.44/8.2 (DPS 0.045)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0192*3+0.0806 = 0.1382(It may take 3Q to apply corrective measures to control costs, minimise rejects and maximise its production capacity), estimate highest/lowest PE = 15.16/10.67 (DPS 0.025)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.3788 (0.1804*2 = 0.3608, 5% grow from 0.3608), estimate highest/lowest PE = 8.65/5.24 (DPS 0.025)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.3674, estimate highest/lowest PE = 9.44/7.57 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0185*4 = 0.074, estimate highest/lowest PE = 11.62/9.95 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0158*4 = 0.0632, estimate highest/lowest PE = 8.39/5.49 (DPS 0.01)
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0065*4 = 0.026, estimate highest/lowest PE = 13.46/9.23 (DPS 0.01)
- Estimate next 4Q eps after 2009 Q1 result announced = 0.0103*4 = 0.0412, estimate highest/lowest PE = 6.8/3.64 (DPS 0.01)

NOTION latest news (English)

NOTION latest news (Chinese)