KLCI Stock - TGOFFS / 7228 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	239,391,160 (Small)
Par Value	RM 0.50

My Analysis

Forecast P/E now	0.82/0.026 = 31.54 (High)
Target Price	0.026*10.0 = 0.26 (PE 10.0, EPS 0.026)
Decision	Not interested unless stock price break 0.88
Comment	Revenue decreased 35.8% and also lower than preceding year corresponding quarter 14.3%, eps decreased 106.1% and also lower than preceding year corresponding quarter 155.6%, cash generated from operating enough to cover financing activities but spent 69.2% of Group cash for investing expenses, slightly weaker liquidity ratio at low level now, higher gearing ratio at very high level now, all accounting ratio are acceptable, higher inventory can indicate amount of works is in good trend
First Support Price	0.78
Second Support Price	0.72
Risk Rating	HIGH

Research House

TA Target Price	0.72 (2011-05-20)
AMMB Target Price	0.71 (2011-10-03)
OSK Target Price	0.53 (2011-10-24)
Maybank Target Price	0.98 (2011-12-01)

Accounting Ratio

Return on Equity	0.88%
Dividend Yield	-
Profit Margin	0.28%
Tax Rate	172.37%
Asset Turnover	0.4778
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	0.16
Liquidity Current Ratio	1.158
Liquidity Quick Ratio	1.0729
Liquidity Cash Ratio	0.1478
Gearing Debt to Equity Ratio	2.0355
Gearing Debt to Asset Ratio	0.6666
Working capital per thousand Ringgit sale	9.3%
Days to sell the inventory	19
Days to collect the receivables	199
Days to pay the payables	139

My notes based on 2011 quarter 3 report (number in '000):-
- Lower revenue due to the slowdown in business activities for the engineering equipment division

- Lower pbt due to impairment of receivables and higher costs incurred in certain engineering equipment packages

- No estimate next 4Q eps after 2011 Q3 result announced, use ROE of 2% as eps = 0.026, estimate PE on current price 0.82 = 31.54
- Estimate next 4Q eps after 2011 Q2 result announced = (0.0246+0.0106)*2 = 0.0704, estimate highest/lowest PE = 13.78/10.23
- 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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