KLCI Stock - SIME / 4197 - 2012 Quarter 1

Company Info

Market Capital (Capital Size)	54,505,836,947 (Very Large)
Par Value	RM 0.50

My Analysis

Forecast P/E now	(9.07-0.3)/0.7863 = 11.15 (Moderate)
Target Price	12.58+0.3 = 12.88 (PE 16.0, EPS 0.7863, DPS 0.3)
Decision	BUY if MACD moving back to uptrend
Comment	Revenue decreased 15.3% but higher than preceding year corresponding quarter 27.5%, eps decreased 18.2% but higher than preceding year corresponding quarter 64.1%, cash generated from operating enough to cover financing expenses but still spent 7.4% of Group cash to cover investing expenses, slightly weaker liquidity ratio at low level now, lower gearing ratio at above moderate level now, all accounting ratio are good, most segment revenue lower than preceding quarter, CPO price uptrend at above 3.1k
First Support Price	9.0
Second Support Price	8.5
Risk Rating	MODERATE

Research House

AMMB Target Price	10.6 (2011-04-26)
CIMB Target Price	10.9 (2011-05-27)
OSK Target Price	8.47 (2011-05-30)
Credit Suisse Target Price	8 (2011-06-21)
Kenanga Target Price	11.06 (2011-07-26)
Affin Target Price	11.09 (2011-08-10)
HwangDBS Target Price	10.4 (2011-08-11)
UOB Target Price	10.4 (2011-09-21)
ECM Target Price	9.16 (2011-11-29)
HLG Target Price	9.08 (2011-11-29)
Maybank Target Price	8.5 (2011-12-15)
TA Target Price	10.1 (2012-01-04)
MIDF Target Price	11 (2012-01-10)
RHB Target Price	10.65 (2012-01-12)

Accounting Ratio

Return on Equity	16.83%
Dividend Yield	2.43%
Profit Margin	13.11%
Tax Rate	24.56%
Asset Turnover	1.0267
Net Asset Value Per Share	4.17
Net Tangible Asset per share	4.16
Price/Net Tangible Asset Per Share	2.13
Cash Per Share	0.87
Liquidity Current Ratio	1.7586
Liquidity Quick Ratio	1.019
Liquidity Cash Ratio	0.3987
Gearing Debt to Equity Ratio	0.715
Gearing Debt to Asset Ratio	0.409
Working capital per thousand Ringgit sale	22.2%
Days to sell the inventory	89
Days to collect the receivables	56
Days to pay the payables	75

Technical Analysis

SMA 20	9.091 (Uptrend 70 days)
SMA 50	8.929 (Uptrend)
SMA 100	8.609 (Uptrend)
SMA 200	8.711 (Uptrend)
MACD	0.128481 (Downtrend 8 days)
MACD Histogram	-0.014749 (Downtrend 6 days)

My notes based on 2012 quarter 1 report (number in '000):-
- Higher revenue and pbt than FY11Q1 mainly due to higher average crude palm oil (CPO) price realised of RM2,946 against RM2,511 per tonne and Fresh fruit bunches (FFB) production is higher by 8.2%, driven by both Malaysia and Indonesia of 7.3% and 10.1% respectively. Property got higher revenue due to higher percentage of property development works completed and sales in the Group’s property development townships at USJ Heights and Denai Alam

- Lower revenue and pbt than FY11Q4 mainly due to the lower average CPO price realised of RM2,946 per tonne as compared to RM3,114 per tonne in the preceding quarter. In addition, the midstream and downstream activities registered a higher loss of RM38.2 million as compared to RM27.5 million in the preceding quarter

- Estimate next 4Q eps after 2012 Q1 result announced = 0.1787*4*1.1 = 0.7863, estimate PE on current price 9.07 = 11.15(DPS 0.3)
- Estimate next 4Q eps after 2011 Q4 result announced = 0.6098*1.1 = 0.6708, estimate highest/lowest PE = 13.27/9.99 (DPS 0.3)
- Estimate next 4Q eps after 2011 Q3 result announced = (0.146+0.1365)*2 = 0.565, estimate highest/lowest PE = 16.27/14.94 (DPS 0.11)
- Estimate next 4Q eps after 2011 Q2 result announced = (0.146+0.1089)*2 = 0.5098(cpo price decreasing but offset by contracts awarded), estimate highest/lowest PE = 18.22/17.01 (DPS 0.11)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.1271*4*1.1 = 0.5592(ROE 3.5% per quarter with condition CPO price continue maintain high), estimate highest/lowest PE = 16.79/15.22 (DPS 0.1)
- No estimate next 4Q eps after 2010 Q4 result announced
- No estimate next 4Q eps after 2010 Q3 result announced
- Estimate next 4Q eps after 2010 Q2 result announced = 0.37, estimate highest/lowest PE = 22.22/19.59 (DPS 0.22)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.34, estimate highest/lowest PE = 26.44/23.76(DPS 0.2)
- Estimate next 4Q eps after 2009 Q4 result announced = 0.37, estimate highest/lowest PE = 24.43/21.59 (DPS 0.2)
- Estimate next 4Q eps after 2009 Q3 result announced = 0.34, estimate highest/lowest PE = 24.35/18.91 (DPS 0.27)

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