KLCI Stock - TGOFFS / 7228 - 2011 Quarter 2

Company Info

Market Capital (Capital Size)	259,826,991 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	0.89/0.0704 = 12.64 (High)
Target Price	0.0704*10.0 = 0.70 (PE 10.0, EPS 0.0704)
Decision	Not interested unless stock price next uptrend start above 0.8
Comment	Revenue increased 82.1% and also higher than preceding year corresponding quarter 33.5%, eps very largely increased 325.7% and also higher than preceding year corresponding quarter 98.4%, cash generated from operating and Group cash also not enough to cover financing activities, slightly weaker liquidity ratio at low level now, higher gearing ratio at high level now, receivables and payables period around 4-6 months still acceptable, receivables got significant increased can indicate contract increase
First Support Price	0.8
Second Support Price	0.72
Risk Rating	HIGH

Research House

TA Target Price	0.72 (2011-05-20)
OSK Target Price	1.29 (2011-07-04)
AMMB Target Price	0.71 (2011-10-03)
Maybank Target Price	0.98 (2011-10-03)

Accounting Ratio

Return on Equity	1.21%
Dividend Yield	-
Profit Margin	4.57%
Tax Rate	9.84%
Asset Turnover	0.5032
Net Asset Value Per Share	1.28
Net Tangible Asset per share	1.25
Price/Net Tangible Asset Per Share	0.68
Cash Per Share	0.14
Liquidity Current Ratio	1.1751
Liquidity Quick Ratio	1.1003
Liquidity Cash Ratio	0.1391
Gearing Debt to Equity Ratio	1.9917
Gearing Debt to Asset Ratio	0.6618
Working capital per thousand Ringgit sale	9.1%
Days to sell the inventory	15
Days to collect the receivables	183
Days to pay the payables	127

My notes based on 2011 quarter 2 report (number in '000):-
- The increase in revenue is due to additional engineering equipment and maintenance contracts secured and completed during the quarter under review. In line with higher revenue from the equipment and maintenance services coupled with higher utilization of our offshore support vessels from a more robust market, net profit after tax increased by 110.03%. During the period, we have also reduced our losses from the engineering equipment division through implementation of our cost reduction exercise and streamlining of business operations. The engineering equipment division has also registered improved profitability margins in the current quarter under review

- Estimate next 4Q eps after 2011 Q2 result announced = (0.0246+0.0106)*2 = 0.0704, estimate PE on current price 0.89 = 12.64
- Estimate next 4Q eps after 2011 Q1 result announced = 0.004*0.9*4*1.1 = 0.0158, estimate highest/lowest PE = 70.89/53.8
- Estimate next 4Q eps after 2010 Q3 result announced = 0.035*1.1*2 = 0.077(use 100% improvement forecast), estimate highest/lowest PE = 21.3/14.03
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0124*4*1.1*2 = 0.1091, estimate highest/lowest PE = 17.78/13.84 (DPS 0.01)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0119*4*1.1*2 = 0.1048, estimate highest/lowest PE = 19.18/10.11 (DPS 0.01)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.0096*4*2 = 0.0768, estimate highest/lowest PE = 16.01/9.4 (DPS 0.01)

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