KLCI Stock - TENAGA / 5347 - 2012 Quarter 2

Company Info

Market Capital (Capital Size)	36,653,905,780 (Very Large)
Par Value	RM 1.00

My Analysis

Forecast P/E now	(6.7-0.2)/0.6442 = 10.09 (Moderate)
Target Price	7.73+0.2 = 7.93 (PE 12.0, EPS 0.6442, DPS 0.2)
Decision	BUY if stock price continue strong sustain around SMA20
Comment	Revenue decreased 0.5% and was second consecutive quarter decreasing but still higher than preceding year corresponding quarter 15%, eps largely increased 1351.9% from loss and also higher than preceding year corresponding quarter 264.5%, cash generated from operating enough to cover all expenses and still got cash generated from financing to further enhance Group cash, operating margin start recovered, stronger liquidity ratio at moderate level now, lower gearing ratio but still at high level now, slightly lower debt ratio but still high, all collection/repayment is good, lower operating expenses due to coal price decreasing and reduced in use of alternative fuels, affecting by strengthening of USD and JYP against RM
First Support Price	6.5
Second Support Price	6.0
Risk Rating	MODERATE

Research House

Jupiter Target Price	6.84 (2012-03-13)
RHB Target Price	7.6 (2012-04-12)
Maybank Target Price	7.4 (2012-04-13)
MIDF Target Price	7.5 (2012-04-13)
OSK Target Price	7.68 (2012-04-13)
ZJ Target Price	7.2 (2012-04-23)
Alliance Target Price	7.56 (2012-05-25)
CIMB Target Price	7.98 (2012-06-11)
HLG Target Price	7.16 (2012-06-11)
HwangDBS Target Price	7 (2012-06-19)
TA Target Price	7.7 (2012-06-19)
Kenanga Target Price	7.5 (2012-06-26)
AMMB Target Price	7.35 (2012-06-27)

Accounting Ratio

Return on Equity	4.99%
Dividend Yield	2.99%
Gross Profit Margin	0.00%
Operating Profit Margin	44.17%
Net Profit Margin	41.55%
Tax Rate	21.60%
Asset Turnover	0.4015
Net Asset Value Per Share	6.41
Net Tangible Asset per share	6.41
Price/Net Tangible Asset Per Share	1.02
Cash Per Share	1.66
Liquidity Current Ratio	2.667
Liquidity Quick Ratio	2.3167
Liquidity Cash Ratio	1.1175
Gearing Debt to Equity Ratio	1.4299
Gearing Debt to Asset Ratio	0.5873
Working capital per thousand Ringgit sale	39.5%
Days to sell the inventory	33
Days to collect the receivables	103
Days to pay the payables	71

Technical Analysis

SMA 20	6.528 (Uptrend 11 days)
SMA 50	6.469 (Uptrend)
SMA 100	6.379 (Uptrend)
SMA 200	5.954 (Uptrend)
MACD (26d/12d)	0.06377 ( 0.004513 )
Signal (9)	0.038942 ( 0.006207 )
MACD Histogram	0.024828 (Bullish trend 8 days)
Bolinger Upper Band	6.748
Bolinger Lower Band	6.308

My notes based on 2012 quarter 2 report (number in '000):-
- Higher revenue than FY11Q2 mainly due to an increase in sales of electricity in Peninsular Malaysia and the tariff increase of 7.12% on 1 June 2011 and electricity demand grew by 4.1% in Peninsular and 4.8% in SESB

- Higher pbt mainly due to the fuel cost compensation received from the Government and Petronas amounting to RM2,023 mil and appreciation of the Ringgit has resulted in a foreign exchange translation gain of RM209.3 mil (vs FY11Q2)

- Compared to FY12Q1, operating expenses were lower mainly due to lower generation costs from reduced utilisation of oil and distillate

- The strengthening of the Ringgit against the Japanese Yen and the USD resulted in a higher foreign exchange gain of RM628.4 mil

- Estimate next 4Q eps after 2012 Q2 result announced = 35162500*0.1/5457914 = 0.6442, estimate PE on current price 6.7 = 10.09(DPS 0.2)
- Estimate next 4Q eps after 2012 Q1 result announced = 30044200*0.08/5456669 = 0.4405(ROE 8%), estimate highest/lowest PE = 15.15/13.2 (DPS 0.045)
- Price moving after 2011 Q4 result announced mainly base on technical analysis and ad-hos news, however if based on average eps of FY11Q1 & FY11Q2 and higher tariff, 4Q eps = 0.4424*1.2 = 0.5309, estimate highest/lowest PE = 11.97/9.97 (DPS 0.045)
- Price moving after 2011 Q3 result announced mainly base on technical analysis and ad-hos news, however if based on average eps of FY11Q1 & FY11Q2, 4Q eps = 0.1229*4*0.9 = 0.4424, estimate highest/lowest PE = 14.18/10.61 (DPS 0.195)
- Estimate next 4Q eps after 2011 Q2 result announced = (0.1415+0.163)*2*1.05 = 0.6395, estimate highest/lowest PE = 10.96/9.01 (DPS 0.2)
- Estimate next 4Q eps after 2011 Q1 result announced = 0.7355*0.8 = 0.5884, estimate highest/lowest PE = 10.74/9.74 (DPS 0.21)
- Estimate next 4Q eps after 2010 Q4 result announced = 0.089*4 = 0.356, estimate highest/lowest PE = 24.21/21.88 (DPS 0.26)
- Estimate next 4Q eps after 2010 Q3 result announced = 0.71*1.05 = 0.7455 (5% increase adjustment), estimate highest/lowest PE = 12.22/11.21 (DPS 0.183)
- Estimate next 4Q eps after 2010 Q2 result announced = 0.2066+0.1859+0.1673+0.1506 = 0.71 (average 10% drop each quarter, coal price increasing but strong Ringgit offset some impact), estimate highest/lowest PE = 12.14/11.01 (DPS 0.183)
- Estimate next 4Q eps after 2010 Q1 result announced = 0.6484, estimate highest/lowest PE = 13.38/11.67 (DPS 0.163)

Coal price chart
- http://www.mongabay.com/images/commodities/charts/chart-coalaust.html
- http://www.globalcoal.com/

MYR/JPY chart

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