KLCI Stock - AXIATA / 6888 - 2011 Quarter 4

Company Info 

Market Capital (Capital Size)	45,108,461,555 (Very Large)
Par Value	RM 1.00

My Analysis 

Forecast P/E now	(5.32-0.19)/0.2988 = 17.17 (High)
Target Price	5.08+0.19 = 5.27 (PE 17.0, EPS 0.2988, DPS 0.19)
Decision	Not interested unless stock price drop near to SMA20 and got very strong buy volume than selling and must MACD move up or wait start move up from Bolinger lower band with very strong buy volume than selling
Comment	Revenue increased 1.7% and was third consecutive quarter increasing and also higher than preceding year corresponding quarter 6.2%, eps decreased 7.5% and was second consecutive quarter decreasing but higher than preceding year corresponding quarter 248.6%, cash generated from operating more than enough to cover financing expenses and together with cash from borrowings enough to cover others expenses, operating profit margin decreasing, weaker liquidity ratio at low level now, higher gearing ratio from above moderate to high level now, higher debt ratio but still far from historical high, all repayment period still good, benefit from weaken of USD against Opco currency from Jan to March, affect by strengthen of Ringgit against Rupiah from Jan to March
First Support Price	5.0
Second Support Price	4.65
Risk Rating	MODERATE

Research House

Credit Suisse Target Price	6.1 (2011-03-30)
JF Apex Target Price	5.29 (2011-08-24)
TA Target Price	5.95 (2011-08-24)
UOB Target Price	5.5 (2011-08-24)
Affin Target Price	4.39 (2011-12-02)
RHB Target Price	5.15 (2011-12-13)
AMMB Target Price	5.9 (2012-02-24)
CIMB Target Price	5.48 (2012-02-24)
HwangDBS Target Price	5.15 (2012-02-24)
Maybank Target Price	5.1 (2012-02-24)
MIDF Target Price	5.75 (2012-02-24)
ECM Target Price	5.19 (2012-03-15)
OSK Target Price	5.8 (2012-03-15)
HLG Target Price	5.02 (2012-03-26)
Kenanga Target Price	5.3 (2012-03-28)

Accounting Ratio 

Return on Equity	11.11%
Dividend Yield	3.57%
Gross Profit Margin	0.00%
Operating Profit Margin	20.85%
Net Profit Margin	16.42%
Tax Rate	10.49%
Asset Turnover	0.4056
Net Asset Value Per Share	2.27
Net Tangible Asset per share	1.29
Price/Net Tangible Asset Per Share	3.95
Cash Per Share	0.78
Liquidity Current Ratio	1.1455
Liquidity Quick Ratio	1.1039
Liquidity Cash Ratio	0.8058
Gearing Debt to Equity Ratio	1.0074
Gearing Debt to Asset Ratio	0.4792
Working capital per thousand Ringgit sale	7.3%
Days to sell the inventory	10
Days to collect the receivables	47
Days to pay the payables	168

Technical Analysis 

SMA 20	5.174 (Uptrend 7 days)
SMA 50	5.069 (Uptrend)
SMA 100	4.97 (Uptrend)
SMA 200	4.869 (Uptrend)
MACD (26d/12d)	0.058671 ( 0.003858 )
Signal (9)	0.044586 ( 0.003521 )
MACD Histogram	0.014085 (Bullish trend 6 days)

My notes based on 2011 quarter 4 report (number in '000):-
- Higher revenue and pbt than FY10Q4 due from Malaysia higher prepaid and other revenue, which consist mainly revenue from device sales and broadband segment, Indonesia grew from subscriber base, data and value added services, Bangladesh grew from higher prepaid and interconnect revenue, Sri Lanka grew from higher prepaid revenue offset by strengthening of RM against local currencies of OpCo

- The Group recorded foreign exchange losses of RM158.4 million in Q4’11 as compared to foreign exchange gains of RM37.4 million in Q4’10, mainly contributed by translation loss in Bangladesh and Sri Lanka as a result of strengthening of USD against local currencies in Q4’11

- Higher pbt also due from utilisation of investment tax credit on LBTI enjoyed by Malaysia

- Higher revenue than FY11Q3 due from Indonesia grew prepaid voice revenue, Growth in Malaysia and Sri Lanka were driven by higher prepaid and other revenue which were mostly device revenue, Bangladesh grew from higher prepaid and interconnect revenue and weakening of RM against local currencies of OpCo

- The Group recorded foreign exchange loss of RM158.4 million in Q4’11 as compared to foreign exchange loss of RM53.1 million in Q3’11, as the results of the translation loss of USD borrowing due to the strengthening of USD against local currencies in Q4’11 particularly Bangladesh and Indonesia

- Estimate next 4Q eps after 2011 Q4 result announced = 21120867*0.12/8481775 = 0.2988, estimate PE on current price 5.32 = 17.17(DPS 0.19)
- Estimate next 4Q eps after 2011 Q3 result announced = (0.0781+0.0694)*2*1.05 = 0.3098, estimate highest/lowest PE = 16.3/14.56 (DPS 0.14)
- Estimate next 4Q eps after 2011 Q2 result announced = (0.0781+0.0645)*2*1.05 = 0.2995, estimate highest/lowest PE = 16.56/14.32 (DPS 0.14)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.3024, estimate highest/lowest PE = 16.93/14.62 (DPS 0.1)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.072*4*1.05 = 0.3024, estimate highest/lowest PE = 16.47/15.08 (DPS 0.1)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.0752*4*1.05 = 0.3158, estimate highest/lowest PE = 16.12/13.93
- Estimate next 4Q eps after 2010 Q2 result announced = 0.0681*4*1.05 = 0.286, estimate highest/lowest PE = 16.29/15.24
- Estimate next 4Q eps after 2010 Q1 result announced = 0.265(no adjustment due to higher profit is from non-repeatable income), estimate highest/lowest PE = 16.98/13.89
- Estimate next 4Q eps after 2009 Q4 result announced = 0.631(average recent 3 quarter)*4 = 0.2524+(0.05*0.2524) = 0.265(5% grow from 0.2524), estimate highest/lowest PE = 15.28/13.21
- Estimate next 4Q eps after 2009 Q3 result announced = 0.0595*4 = 0.238, estimate highest/lowest PE = 14.71/12.61
- Estimate next 4Q eps after 2009 Q2 result announced = 0.0579*4 = 0.2316, estimate highest/lowest PE = 14.12/12.52

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