KLCI Stock - CSCSTEL / 5094 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	497,800,000 (Small)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(1.31-0.07)/0.1067 = 11.62 (High)
Target Price	1.07+0.07 = 1.14 (PE 10.0, EPS 0.1067, DPS 0.07)
Decision	Not interested unless stock price sustain and next uptrend start above 1.3
Comment	Revenue increased 6.8% and also higher than preceding year corresponding quarter 66.4%, eps decreased 80.6% and was second consecutive quarter decreasing but still higher than preceding year corresponding quarter 178.6%(mainly due to tax income), no cash generated from operating after deducted the expenses for inventories and receivables hence spent 26.7% of Group cash to cover all expenses, stronger liquidity ratio at very strong level now, lower gearing ratio at low level now, all accounting ratio are good, higher inventory can indicate sales demand remain strong, affecting by raw materials increased sharply
First Support Price	1.3
Second Support Price	1.13
Risk Rating	MODERATE

Research House

HLG Target Price	1.62 (2011-08-16)
OSK Target Price	1.78 (2011-10-14)
RHB Target Price	0.9 (2011-11-08)

Accounting Ratio

Return on Equity	5.17%
Dividend Yield	9.92%
Profit Margin	-0.62%
Tax Rate	-
Asset Turnover	1.3773
Net Asset Value Per Share	2.07
Net Tangible Asset per share	2.07
Price/Net Tangible Asset Per Share	0.67
Cash Per Share	0.57
Liquidity Current Ratio	10.9782
Liquidity Quick Ratio	6.9919
Liquidity Cash Ratio	4.0827
Gearing Debt to Equity Ratio	0.1147
Gearing Debt to Asset Ratio	0.1029
Working capital per thousand Ringgit sale	43.9%
Days to sell the inventory	69
Days to collect the receivables	47
Days to pay the payables	17

My notes based on 2011 quarter 3 report (number in '000):-
- Higher revenue due to increases in sales volume of all our steel products albeit at lower selling prices

- Loss due to lower selling prices and higher sales and marketing expenses

- Estimate next 4Q eps after 2011 Q3 result announced = 0.1186*0.9 = 0.1067, estimate PE on current price 1.31 = 11.62(DPS 0.07)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.1483*0.8 = 0.1186, estimate highest/lowest PE = 11.89/8.68 (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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