MYEG – Fundamental Analysis (4 Mar 2015)

MYEG Analysis:-

Excel – http://1drv.ms/1M73Oqj

Notes – http://tinyurl.com/lrxchw9

My View:-

  • Valuation:
    • Absolute EY%:
      • Trailing:
        • FY14 (EPS: 0.085) – Fair value 2.27 (Fair Value Uncertainty: EXTREME)
        • R4Q (EPS: 0.096) – Fair value 2.56 (Fair Value Uncertainty: VERY HIGH)
      • Forward:
        • FY15 (EPS: 0.09) – Fair value 2.4 (Fair Value Uncertainty: VERY HIGH)
        • FY16 (EPS: 0.174) – Fair value 4.65 (Fair Value Uncertainty: LOW)
      • EPS applied to reach the current stock price (2.85): 0.107
  • Higher estimation of EPS for FY16 factored in potential CSTM project which will be MyEG’s main earnings growth driver over the next few years
  • 3 Mar 2015 – The adoption of foreign worker permit renewal since the announcement of the closure of the immigration department counters in January 2015 has risen significantly to 60,000 transactions per month from 10,000 per month in December 2014. Permanent car ownership transfer transactions rose to 1500 per day in December 2014 compared to 300 per day a year ago. This further reinforces that commercial e-government services have a much faster adoption rate since each user utilises the service in their daily business transactions.​
  • This is a no-brainer business and fully blessed by our beloved Government.

Latest Financial – Q2 2015 Financial Report (27 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1889601

At the time of writing, my family member owned shares of MYEG.

MAYBANK – Fundamental Analysis (4 Mar 2015)

MAYBANK Analysis:-

Excel – http://1drv.ms/1GiyDb7

Notes – http://tinyurl.com/kkqt2c9

My View:-

  • Valuation:
    • Absolute EY%:
      • Trailing:
        • FY14 (EPS: 0.742) – Fair value 9.94 (Fair Value Uncertainty: HIGH)
        • R4Q (EPS: 0.724) – Fair value 9.71 (Fair Value Uncertainty: HIGH)
      • Forward:
        • FY15 (EPS: 0.731) – Fair value 9.8 (Fair Value Uncertainty: HIGH)
        • FY16 (EPS: 0.778) – Fair value 10.43 (Fair Value Uncertainty: HIGH)
      • EPS applied to reach the current stock price (9.35): 0.697
    • Dividend Discount Model
      • Base Scenario: 9.21 (Fair Value Uncertainty: HIGH)
      • Good Scenario: 9.03 (Fair Value Uncertainty: HIGH)
      • Bad Scenario: 8.85 (Fair Value Uncertainty: HIGH)
      • Ugly Scenario: 8.69 (Fair Value Uncertainty: HIGH)
    • Residual Income Model (This model is very defensive. I consider the derived price as the bare minimum price)
      • Base Scenario: 9.03
      • Good Scenario: 7.33
      • Bad Scenario: 5.78
      • Ugly Scenario: 4.36
  • In my opinion, MAYBANK is currently fully valued. Compare to my previous valuation, the fair values are reduced due to declining of ROE and stagnant dividend payout growth.
  • Despite Net profit is unexpectedly strong (+20.1%qoq; +11.5%yoy), MAYBANK’s ROE declined from 14.2% (FY13) to 12.7% (FY14).
    • Please note that my ROE calculation is slightly different from other analysts, but disregard formula variant, MAYBANK ROE has been declining in these few years.
    • I think this is a common issue in Malaysia banking
    • For latest Banking analysis, please refer: http://tinyurl.com/lv5yp9q
  • For FY15, management has guided an ROE of 13-14%, Group loan growth of 9-10% (Malaysia: 8-9%, Singapore: 8-9% and Indonesia: 13-15%), Group deposit growth of 9-10%, CI ratio of 47-48%, NIM contraction of 8-10bp and credit cost of not more than 0.30%.
  • Due to its strong dividend yield, healthy liquidity and strong capital position, I will continue to hold MAYBANK, and accumulate MAYBANK without increasing my average price too much.

Latest Financial – Q4 2014 Financial Report (26 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1885573

At the time of writing, I owned shares of MAYBANK.

CARLSBG – Fundamental Analysis (4 Mar 2015)

CARLSBG Analysis:-

Excel – http://1drv.ms/1AG006N

Notes – http://tinyurl.com/kdtolbw

My View:-

  • Valuation:
    • 5-Y DCF:
      • Good Scenario: 10.88 (Fair value uncertainty: VERY HIGH)
      • Base Scenario: 9.5 (Fair value uncertainty: EXTREME)
      • Bad Scenario: 8.28 (Fair value uncertainty: EXTREME)
      • Ugly Scenario: 7.2 (Fair value uncertainty: EXTREME)
      • At current price (13.16), based on RDCF, assumption of FCFF growth rate in the next 5 years is 15.8%.
    • Absolute EY%:
      • Trailing:
        • FY14 (EPS: 0.692) – Fair value 12.69 (Fair Value Uncertainty: HIGH)
        • R4Q (EPS: 0.692) – Fair value 12.69 (Fair Value Uncertainty: HIGH)
      • Forward:
        • FY15 (EPS: 0.713) – Fair value 13.07 (Fair Value Uncertainty: HIGH)
        • FY16 (EPS: 0.756) – Fair value 13.86 (Fair Value Uncertainty: HIGH)
      • EPS applied to reach the current stock price (13.16): 0.718
  • Going forward, I remain conservative and skeptical above volume growth in the brewery sector as some reports show that the industry is saturated, coupled with several other external factors such as rising fuel costs, inflation as well as potential exposure to excise duty hike in the near future. However, earnings should be sustainable at current levels.
  • CARLSBG is determined to move away from a single star beer product company to become a star beer portfolio company. Over the past 10 years, CARLSBG has been trying to launch a couple of new products into the market. To date, however, its Carlsberg Green Label is still viewed as the group’s only crown jewel. As such, a reshuffle has been undertaken in its top management team over the last 2 to 3 years with the aim of bringing good changes to the group. Besides, it has also appointed a few brand managers to oversee the brand building efforts across a few main products, whereby premium brands are expected to form a larger proportion of its new product portfolio. While efforts are being made to build market share for its premium products, the Carlsberg Green Label will remain as the bread and butter of the group. Whether or not CARLSBG will be able to return to its former glory, it is still too early to tell, but the good efforts warrant CARLSBG a buy/hold call for the long term. There are downside risks if things do not turn out as expected.
  • Valuation wise, CARLSBG is fully or over valued, but its Dividend Yield is 5.3%. You basically pay premium to buy an outstanding dividend counter.

Latest Financial – Q4 2014 Financial Report (27 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1888157

At the time of writing, I owned shares of CARLSBG.

AIRASIA – Fundamental Analysis (3 Mar 2015)

AIRASIA Analysis:-

Excel – http://1drv.ms/1KdaKVl

Notes – http://tinyurl.com/ou8g4dn

My View:-

  • Valuation:
    • Absolute EY% Valuation
      • Trailing:
        • FY14 (EPS: 0.03) – Fair value 0.45 (Fair Value Uncertainty: EXTREME)
        • R4Q (EPS: 0.03) – Fair value 0.46 (Fair Value Uncertainty: EXTREME)
      • Forward:
        • FY15 (EPS: 0.31) – Fair value 4.73 (Fair Value Uncertainty: MEDIUM)
        • FY16 (EPS: 0.347) – Fair value 5.29 (Fair Value Uncertainty: LOW)
      • EPS applied to reach the current stock price (2.43): 0.159
  • Excluding unrealised forex losses, gain on disposal and deferred tax, AirAsia registered 4Q14 core profit of RM41.4m (-59.7%yoy).
  • Now, the main issue is the huge unrealised forex losses. Nevertheless, this is not the first time AIRASIA encountered this issue, and AIRASIA managed to go through this issue because of excellent operational efficiency. Besides, for this time, lower average effective fuel cost in FY15 will cushion this issue.
  • Positives:
    • A more rational market with further yield recovery
    • Capacity management to reduce costs
    • Better ancillary income.
  • Beside huge unrealised forex losses, 1Q15 results could be under par as a result of 60 days blackout on advertising following the QZ8501 incident.
  • Of course, I am worry about AIRASIA, but I believe AIRASIA will be able to go through these issues.

Latest Financial – Q4 2014 Financial Report (26 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1887429

At the time of writing, I owned shares of AIRASIA.

OCK – Fundamental Analysis (2 Mar 2015)

OCK Analysis:-

Excel – http://1drv.ms/1K6RXuM

Notes – http://tinyurl.com/kgpwazt

My View:-

  • Valuation:
    • Absolute EY%:
      • Trailing:
        • FY14 (EPS: 0.049) – Fair value 1.1 (Fair Value Uncertainty: MEDIUM)
        • R4Q (EPS: 0.049) – Fair value 1.1 (Fair Value Uncertainty: MEDIUM)
      • Forward:
        • FY15 (EPS: 0.06) – Fair value 1.34 (Fair Value Uncertainty: LOW)
        • FY16 (EPS: 0.07) – Fair value 1.56 (Fair Value Uncertainty: LOW)
      • EPS applied to reach the current stock price (0.93): 0.042
  • In my opinion, OCK is undervalued, and looks like its growth drivers are quite secured.

Latest Financial – Q4 2014 Financial Report (26 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1887585

At the time of writing, I did not own shares of OCK.

BOILERM – Fundamental Analysis (2 Mar 2015)

BOILERM Analysis:-

Excel – http://1drv.ms/1DIm71c

Notes – http://tinyurl.com/mf7ng3w

My View:-

  • Valuation:
    • 5Y-DCF:
      • Good Scenario: 2.13 (Fair value uncertainty: LOW)
      • Base Scenario: 1.88 (Fair value uncertainty: MEDIUM)
      • Bad Scenario: 1.65 (Fair value uncertainty: MEDIUM)
      • Ugly Scenario: 1.44 (Fair value uncertainty: HIGH)
      • At current price (1.5), based on RDCF, assumption of FCFF growth rate in the next 5 years is 13%.
    • Absolute EY%:
      • Trailing:
        • FY14 (EPS: 0.12) – Fair value 2.36 (Fair Value Uncertainty: LOW)
        • R4Q (EPS: 0.125) – Fair value 2.45 (Fair Value Uncertainty: LOW)
      • Forward:
        • FY15 (EPS: 0.128) – Fair value 2.51 (Fair Value Uncertainty: LOW)
        • FY16 (EPS: 0.147) – Fair value 2.88 (Fair Value Uncertainty: LOW)
      • EPS applied to reach the current stock price (1.5): 0.077
  • I am very new to this counter. I will look for its competitors, and study more.
  • BOILERM started bullish since Jan of 2013, but looking at this, it is still undervalued
  • I will place this counter in Watch List.

Latest Financial – Q3 2015 Financial Report (25 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1885317

At the time of writing, I did not own shares of BOILERM.

GTRONIC – Fundamental Analysis (1 Mar 2015)

GTRONIC Analysis:-

Excel – http://1drv.ms/1ECwmFV

Notes – http://tinyurl.com/mtp76p4

My View:-

  • Valuation
    • 5Y DCF
      • Good Scenario: 4.71 (Fair value uncertainty: HIGH)
      • Base Scenario: 4.32 (Fair value uncertainty: VERY HIGH)
      • Bad Scenario: 3.95 (Fair value uncertainty: VERY HIGH)
      • Ugly Scenario: 3.61 (Fair value uncertainty: EXTREME)
      • At current price (4.85), based on RDCF, assumption of FCFF growth rate in the next 3 years is 14%.
    • Absolute EY%:
      • Trailing:
        • FY14 (EPS: 0.229) – Fair value 3.17 (Fair Value Uncertainty: EXTREME)
        • R4Q (EPS: 0.229) – Fair value 3.17 (Fair Value Uncertainty: EXTREME)
      • Forward:
        • FY16 (EPS: 0.321) – Fair value 4.43 (Fair Value Uncertainty: VERY HIGH)
        • FY15 (EPS: 0.283) – Fair value 3.91 (Fair Value Uncertainty: VERY HIGH)
      • EPS applied to reach the current stock price (4.85): 0.351
  • Shariah status – Globe could be trade at a premium given the ample domestic liquidity and strong participation by domestic institutions.
  • GTRONIC has been consistently delivering steady earnings growth by keeping pace with market demands. This was shown in its latest quarterly results announcement. With a growing cash pile, the company mostly will continue its attractive dividend payouts. I believe that there is still slight room for the stock to appreciate further with expectation on another solid year ahead in FY15.
  • Dividend Yield is around 4-5%, not bad. However, valuation wise, GTRONIC is not attractive.

Latest Financial – Q4 2014 Financial Report (24 Feb 2015) http://www.bursamalaysia.com/market/listed-companies/company-announcements/1882841

At the time of writing, I did not own shares of GTRONIC.