KLCI Stock - ANNJOO / 6556 - 2011 Quarter 3

Company Info

Market Capital (Capital Size)	972,237,211 (Medium)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(1.86-0.07)/0.121 = 14.79 (High)
Target Price	1.69+0.07 = 1.76 (PE 14.0, EPS 0.121, DPS 0.07)
Decision	Not interested unless stock buying volume stronger than selling and got strong support at 1.8 above
Comment	Revenue increased 12.7% and also higher than preceding year corresponding quarter 87.2%, eps decreased 157.2 and was second consecutive quarter decreasing and also lower than preceding year corresponding quarter 248.4%, cash generated from operating more than enough to cover all expenses, weaker liquidity ratio at low level now, lower gearing ratio but still at high level now, lower inventory can indicate sales slow down
First Support Price	1.8
Second Support Price	1.6
Risk Rating	MODERATE

Research House

RHB Target Price	3.02 (2011-02-22)
OSK Target Price	2.89 (2011-02-25)
CIMB Target Price	3.74 (2011-05-27)
MIDF Target Price	2.8 (2011-05-27)
Affin Target Price	2.7 (2011-09-20)
HLG Target Price	1.34 (2011-11-25)
Maybank Target Price	1.3 (2011-11-25)

Accounting Ratio

Return on Equity	5.84%
Dividend Yield	5.56%
Profit Margin	-4.71%
Tax Rate	-
Asset Turnover	0.8024
Net Asset Value Per Share	1.4
Net Tangible Asset per share	1.38
Price/Net Tangible Asset Per Share	1.43
Cash Per Share	0.13
Liquidity Current Ratio	1.4253
Liquidity Quick Ratio	0.404
Liquidity Cash Ratio	0.0947
Gearing Debt to Equity Ratio	1.5305
Gearing Debt to Asset Ratio	0.604
Working capital per thousand Ringgit sale	21.0%
Days to sell the inventory	190
Days to collect the receivables	56
Days to pay the payables	31

Technical Analysis

SMA 20	1.83 (Uptrend 9 days)
SMA 50	1.844 (Downtrend)
SMA 100	1.973 (Downtrend)
SMA 200	2.345 (Downtrend)
MACD	-0.038709 (Uptrend 22 days)
MACD Histogram	0.026341 (Uptrend 15 days)

My notes based on 2011 quarter 3 report (number in '000):-
- Higher revenue mainly due to higher sales tonnage arisen from the recovery in international market and domestic demand

- Loss mainly attributable to an allowance for diminution in value of inventories of RM37.88 million to reflect the prevailing price level in view of the sharp contraction in international steel prices coupled with an unexpectedly weakened RM against USD that has resulted in recognition of an unrealized foreign exchange loss of RM22.52 million

- Estimate next 4Q eps after 2011 Q3 result announced = (37880+22520-29476)*0.83/763444*4*0.9 = 0.121, estimate PE on current price 1.86 = 14.79(DPS 0.07)
- Estimate next 4Q eps after 2011 Q2 result announced = 0.0477*4*0.8 = 0.1526, estimate highest/lowest PE = 16.56/11.25 (DPS 0.1234)
- Estimate next 4Q eps after 2011 Q1 result announced = (0.04+0.0602)*2 = 0.2004, estimate highest/lowest PE = 14.3/10.96 (DPS 0.1234)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.04*4 = 0.16, estimate highest/lowest PE = 19.31/16.69 (DPS 0.06)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0517*4 = 0.2068(0.0517 is average eps of Q110,Q409,Q308, due to steel price decreasing), estimate highest/lowest PE = 15.91/11.9 (DPS 0.06)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.0591*4 = 0.2364, estimate highest/lowest PE = 12.39/9.31 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.048*4 = 0.192, estimate highest/lowest PE = 15.68/13.54 (DPS 0.03)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0682*4 = 0.2728, estimate highest/lowest PE = 12.17/8.69 (DPS 0.03)

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