DKSH Holdings vs. Harrisons Holdings

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

DKSH Holdings (Malaysia) Berhad's (hereafter called "DKSH") principal activities including general trading, warehousing, and distribution of consumer, pharmaceutical, bio-medical, chemical, and industrial products, and also sale of the Famous Amos chocolate chip cookies. Harrisons Holdings (Malaysia) Berhad's (hereafter called "HARISON") principal activities including marketing, sales and distribution of consumer, engineering, building materials, wines and chemical products and the operation of shipping, insurance and travel agencies.

Side-by-side Comparison

Capitalization
Measure by size, HARISON is slightly bigger than DKSH, 17 millions.

Income Items
Important items under this section is per share earnings and dividend, HARISON is the all-time winner for both per share earning and dividend.

Balance Sheet Items
HARISON have more solid balance sheet compared to DKSH, Liquidity per share is 1.67 and 0.84, where Book value per share is 3.97 and 1.11.

Ratios
By look at Price ratios, HARISON is much more attractive at the moment given it sell at lower multiple of earnings currently and historically and much higher current dividend yield.

HARISON advantages are higher profit margin and appropriate return on book value with adequate gearing as shown by Net income/sales and Total Liabilities/book value. DKSH's level of gearing might be a concern as it is recorded 5.18 times. 

HARISON has better historical earning growth rate compared to DKSH in both near-term and long-term.
 
Price Record
DKSH has much better historical price growth rate in near-term and slightly better in long-term compared to HARISON.

Financial Summary

DKSH's Financial Summary

By looking into detail of the financial summary of DKSH, it show better records in 2010 and 2009 except increase of total liabilities 115 millions, 14.57% in 2010. Record of past two years make the growth numbers look great compare to records of 2006 to 2008. The new management deserved a great applause by achieved a decent operating result (improve return of shareholding equity and profit margin significantly, at the same time reduce the gearing of the company).

HARISON's Financial Summary

HARISON has great historical growth record, recorded CAGR for 8.1% in sales and 21.58% operating income, 29.53% in net income and earning per share and 29.17% in dividend per share. The company CAGR on the previous mentioned items better than DKSH, except net income and earning per share which may due to DKSH start from a low base. Historically, HARISON is more conservative financially compare to DKSH, as it utilized more appropriate level of financial leverages (D/E ratio 76%) compared to DKSH (D/E ratio 517.53%). Even HARISON has much better return on average equity, 5 years averaging 11.4%, compared to DKSH 8%, but DKSH has slightly better return on average equity in 2010 and 2009. However, HARISON has much better return on average assets, 5 years averaging 6.23%, compared to DKSH 1.15%, which may due to it has smaller asset base. Even DKSH has lower operating overhead than HARISON, 5 years averaging 0.78%, HARISON still in the winning side as it 5 years average profit margin is much higher, 2.33% compared to 0.34% of DKSH.

As conclusion, HARISON is the ultimate winner in this comparison.

How Much HARISON Worth?
Given the company CAGR of EPS is 15% (approximately 29.5% in the past 5 years) and Dividend Per Share is 12% in the next 10 years, the EPS of the company will be RM$1.074 in 2021 (included adjustment of 2 bad years in 10 which reduce 30% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$1.85 (included adjustment of 2 bad years).

If the stock price of HARISON sell at 5 times earning in 2021, it is RM$5.37 and included total dividends received, it is RM$7.22 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$7.22 discounted to today price, it is RM$4.27 per share.

The discounted price is 19% higher comparing to yesterday (21 December 2011) closing price RM$3.46. The stock is in bargain! What do you think?

I'd love to hear comments from you!

Plenitude vs. Asas Dunia

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

Plenitude Berhad's (hereafter called "PLENITU") principal activities including property development, property investment and investment holding, provision of management services for hotel industry and travel operations and trading of construction materials. Asas Dunia Berhad's (hereafter called "ASAS") principal activities including property development, building construction, investment holding and property investment.

Side-by-side Comparison

Capitalization
Measure by size, PLENITU is more than double the size of ASAS, 518.4 millions and 228.93 millions

Income Items
Important items under this section is per share earnings and dividend, PLENITU is the all-time winner for both per share earning and dividend.

Balance Sheet Items
PLENITU have much solid balance sheet compared to ASAS, Cash or cash equivalents is double the total liabilities, it is a cash-rich company which liquidity per share is 1.24 and cash available after pay off all liabilities is 169.38 millions (0.63 per share).

Ratios
By look at price ratios, PLENITU is much more attractive at the moment given it sell at lower multiple of earnings currently and historically and higher current dividend yield.

PLENITU advantages are higher profit margin and much higher return on book value as shown by Net income/sales and Earnings/book value per share. Even PLENITU has higher gearing compared to ASAS, it is not a concern at all as the company's cash is more than enough to pay off all liabilities.

PLENITU has much better earning growth rate compared to ASAS, 60.36% and 25.89%.
 
Price Record
PLENITU and ASAS has comparable growth rate in near-term price record, but PLENITU achieved better growth in long-term.

Financial Summary 

PLENITU's Financial Summary

By looking into detail of the financial summary of PLENITU, it show a steady historical growth records, recorded Compounded Annual Growth Rate (hereafter called "CAGR") for 7% in sales and operating income, 12% in net income and earning per share, and 8% in dividend per share. It achieved this steady result with minimal financial leverages and minor increment of total liabilities. Both return on average equity and assets are moderate, but satisfactory. I particularly like the low operating overhead attribute of the company (5 years average 7.01%) shown by narrow margin of Operating Income/Sales and Net Income/Sales.

ASAS's Financial Summary

ASAS has great historical growth record too, recorded CAGR for 12% in sales and 25% operating income, 33% in net income and earning per share. The company CAGR on the previous mentioned items better than PLENITU, but the loser is dividend payment, the company pay 2 dividends of similar amount out of 5 years. Historically, ASAS is more conservative financially compare to PLENITU, as it utilized minimal financial leverages (D/E ratio is less than 15%) compared to PLENITU, this may due to the company is short of liquidity. However, both return on average equity and assets are low, 5 years averaging 2.8% and 2.4%. Even the company have lower operating overhead than PLENITU, 5 years averaging 2.35%, PLENITU still in the winning side as it 5 years average profit margin is higher, 25.3% compared to 19.3% of ASAS.

As conclusion, the ultimate winner of this comparison is PLENITU.

How Much PLENITU Worth?
Given the company CAGR of EPS is 10% (approximately 12.2% in the past 5 years) and Dividend Per Share is 8% in the next 10 years, the EPS of the company will be RM$0.422 in 2021 (included adjustment of 2 bad years in 10 which reduce 30% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$0.80 (included adjustment of 2 bad years).

If the stock price of PLENITU sell at 8 times earning in 2021, it is RM$3.37 and included total dividends received, it is RM$4.17 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$4.17 discounted to today price, it is RM$2.47 per share.

The discounted price is 24.8% higher comparing to today (1 December 2011) closing price RM$1.98. The stock is in great bargain! What do you think?

I'd love to hear comments from you!

TDM vs. Glenealy Plantations

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

TDM Berhad's (hereafter called "TDM") principal activities including management of oil palm plantation, processing and trading of palm oil and related products, also provision of consultancy and management services to specialist medical centres and owner of specialist medical centres. Glenealy Plantations (Malaya) Berhad's (hereafter called "GNEALY") principal activities including operation of oil palm plantations, oil mills and quarries.

Side-by-side Comparison

Capitalization
Measure by size, both companies are similar, TDM is slightly bigger than GNEALY, 77 millions approximately.

Income Items
Important items under this section is per share earnings and dividend, GNEALY is the all-time winner for per share earning, but TDM pay higher dividend.

Balance Sheet Items
Both companies have solid balance sheet, Cash or cash equivalents is more than enough cover the Current liabilities. Current assets is more than enough cover the Total liabilities. GNEALY is stronger financially as it's Cash or cash equivalents is more than enough cover the Total liabilities.

Ratios
Price-wise, TDM is more attractive at the moment given it sell at lower multiple of earnings currently and historically and much higher current dividend yield. TDM achieved higher return on book value, but with lower profit margin. TDM has much better earning growth rate compared to GNEALY, 381.9% and 103.6%.

GNEALY advantages are higher profit margin and much stronger balance sheet as shown by Net income/sales and Current assets/current liabilities. A question come to mind is ... Is the overwhelming availability of current assets of the company showing the incompetency of management in capital allocation? At the same time, the current dividend payout is less than 25% of earning and yielding much lower return compared to TDM.

Price Record
TDM has much higher growth rate in both the long-term and near-term price record, the growth of price is reflected the growth of earnings.

Financial Summary

TDM's Financial Summary

By looking into detail of the financial summary of TDM, it show an amazing historical growth records, more than 50% in operating income, net income, earning per share, dividend per share with an exception in financial year 2009. It achieved this great result with reduction in total liabilities every year in the past 5 years except financial year 2010. Both return on average equity and assets are moderate, but it perform better in the past 3 years. Every year the company have lower and lower utilization of financial leverages shown by D/E ratio. I particularly like the low operating overhead attribute of the company (5 years average 4.54%) shown by narrow margin of Operating Income/Sales and Net Income/Sales.

GNEALY's Financial Summary

GNEALY has great historical growth record too (more than 20% in operating income, net income, earning per share), but less appealing compared to TDM. Historically, GNEALY is more conservative financially compare to TDM, as it utilized minimal financial leverages (D/E ratio is less than 30%) compared to TDM. But this advantage is disappear compare to recent record of TDM as it achieved D/E ratio 28.5%. Also, the company have much higher operating overhead, 5 years averaging 14.59%, 10% higher than TDM.

As conclusion, the ultimate winner of this comparison is TDM.

How Much TDM Worth?
Given the company CAGR of EPS is 20% (approximately 56.1% in the past 5 years) and Dividend Per Share is 15% in the next 10 years, the EPS of the company will be RM$0.635 in 2020 (included adjustment of 2 bad years in 10 which reduce 50% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$1.30 (included adjustment of 2 bad years).

If the stock price of TDM sell at 10 times earning in 2021, it is RM$6.35 and included total dividends received, it is RM$7.65 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$7.65 discounted to today price, it is RM$4.52 per share.

The discounted price is 31.1% higher comparing to today (25 November 2011) closing price at RM$3.45. The stock is a great bargain! What do you think?

I'd love to hear comments from you!

BLD Plantation vs. Kwantas Corporation

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

BLD Plantation Berhad's (hereafter called "BLDPLNT") principal activities including operation of a palm oil refinery and kernel crushing plant, cultivation of oil palm, processing of fresh fruit bunches and sales of related products. Kwantas Corporation Berhad's (hereafter called "KWANTAS") principal activities including operation of oil palm plantations, palm oil mills, kernel crushing plant, palm oil refinery plant, shortening plants, oleochemical plants, biomass power plant, bulking installation and trading of palm oils and fats products.

Side-by-side Comparison

Capitalization
Measure by size, both companies are similar, KWANTAS is slightly bigger than BLDPLNT, 43 millions approximately.

Income Items
Important items under this section is per share earnings and dividend, BLDPLNT is the all-time winner.

Balance Sheet Items
BLDPLNT has much stronger and healthier balance sheet compared to KWANTAS.

Ratios
On the first glance, KWANTAS is more attractive by looking at Price/earnings ratio, given 5.41 times earning. But it is not the case when look into the following items:

1. Price/earnings, 2009-2011: BLDPLNT has more appropriate valuation compared to KWANTAS, 11.42 times earning and 38.6 times earning.
   
2. Current assets/current liabilities: BLDPLNT has adequate level of working capital, where KWANTAS was at alarming level, short of 30%.
   
3. Earning growth per shares: Both near-term and long-term of earning growth of KWANTAS is negative.
   

Price Record
The current price level of BLDPLNT reaching it record level since it listed in 2003, where KWANTAS at the low end of it's historical price level.

As conclusion, the winner of this comparison is BLDPLNT.

Financial Summary

BLDPLNT's Financial Summary

By looking into detail of the financial summary of BLDPLNT, it show a amazing historical growth records with one exception in financial year 2009.

The recent return on average equity (hereafter called "ROAE") is in appropriate level, but return on average asset (hereafter called "ROAA") and profit margin is in single digit. I think this is due to the company involved in trading business.

How Much BLDPLNT Worth?
Given the company CAGR of EPS is 20% (approximately 37.4% in the past 5 years) and Dividend Per Share is 10% in the next 10 years, the EPS of the company will be RM$1.104 in 2020 (included adjustment of 2 bad years in 10 which reduce 50% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$0.98 (included adjustment of 2 bad years).

If the stock price of BLDPLNT sell at 10 times earning in 2021, it is RM$11.04 and included total dividends received, it is RM$12.02 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$12.02 discounted to today price, it is RM$7.11 per share.

The discounted price is merely 4.14% higher comparing to today (24 November 2011) closing price RM$6.83. I don't think the stock is undervalued, what do you think?

I'd love to hear your comments!

Kumpulan Fima vs. Fima Corporation

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

Kumpulan Fima Berhad's (hereafter called "KFIMA") principal activities including production and trading of security and confidential documents, oil palm cultivation including oil palm production and processing, bulk handling and storage of various types of liquid and semi-liquid products and manufacture and distribution of canned fish. Fima Corporation Berhad's (hereafter called "FIMACOR") principal activities including production and trading of security and confidential documents and oil palm cultivation including oil palm production and processing. KFIMA is control entity of FIMACOR, 61.92% shareholdings at financial ended 31 March 2011.

Side-by-side Comparison

 

Capitalization
Measure by size, both companies are similar, FIMACOR slightly bigger than KFIMA, 43 millions approximately.

Income Items
Important items under this section is per share earnings and dividend, FIMACOR is the all-time winner.

Balance Sheet Items
Both companies have a strong balance sheet and are cash-rich company as Cash or cash equivalents is more than enough to pay off all liabilities of the company.

Ratios
Given market price on 31 March 2011, both companies has similar level of valuation, following items catch my eye ball:

1. Net income/sales: FIMACOR has larger profit margin than KFIMA, 10% extra. 
2. Earnings/book value per share: FIMACOR has better rate of return compared with KFIMA, 5% extra. 
3. Total liabilities/book value: More importantly, FIMACOR achieved the results above with lower gearing than KFIMA. 

Also, FIMACOR has better earning growth prospect than KFIMA in both near-term and long-term.

Price Record
FIMACOR has better long-term (2001-2011) price growth rate compared to KFIMA, but the near-term (2010-2011) price growth rate of both companies are similar.

Financial Summary

KFIMA's Financial Summary

FIMACOR's Financial Summary

By looking into detail of the financial summary of both companies, FIMACOR winning all measurements except dividend growth rate.

The 23.38% compounded annual growth rate (hereafter called "CAGR") of total liabilities of FIMACOR catch my attention, it was caused by acquisition happened on 2008 which doubling the total liabilities. This is not an issue as cash on hand of FIMACOR is more than enough to fully cover all liabilities.

As conclusion, the ultimate winner of this comparison is FIMACOR.

How Much FIMACOR Worth?
Given the company CAGR of EPS is 15% (approximately 30.23% in the past 5 years) and Dividend Per Share is 10% in the next 10 years, the EPS of the company will be RM$1.958 in 2020 (included adjustment of 2 bad years in 10 which reduce 30% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$1.67 (included adjustment of 2 bad years).

If the stock price of FIMACOR sell at 10 times earning in 2021, it is RM$19.58 and included total dividends received, it is RM$21.25 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$21.25 discounted to today price, it is RM$12.58 per share.

The discounted price is 119.5% higher comparing to today (22 November 2011) closing price RM$5.73! The stock is in great margin of bargain! What do you think?

QL Resources vs. Lay Hong

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

In this analysis, two agricultural based companies: QL Resources Berhad (hereafter called "QL") and Lay Hong Berhad (hereafter called "LAYHONG") put side-by-side for comparison. QL and LAYHONG was not a direct competitor as QL's principal activities including marine product manufacturing, integrated livestock farming and crude palm oil milling, where LAYHONG's principal activity is integrated livestock farming only. Also, QL is substantial shareholder of LAYHONG, 23.91% shareholdings at financial ended 31 March 2011.

Side-by-side Comparison

Capitalization
Measure by size, QL is about 30 times larger than LAYHONG.

Income Items
Important items under this section is per share earnings and dividend, LAYHONG is the all-time winner except Avg. Earned per share 2005-2007.

Balance Sheet Items
QL has stronger balance sheet, albeit LAYHONG book value per share was 2.77 over QL's 0.95.

Ratios
Given market price on 31 March 2011, LAYHONG has much lower valuation than QL, what make QL has such high valuation?

1. QL has better earning power than LAYHONG, as illustrated by Net income/sales: 7.01% over 3.49% and Earnings/book value per share 15.75% over 10.64%.
2. QL has more appropriate and lower gearing (using less financial leverages) than LAYHONG, as illustrated by Total liabilities/book value, 0.85 over 1.33 and Current assets/current liabilities 1.47 over 0.96.

However, LAYHONG has much better earning growth prospect than QL, 1264.1% over 465.26%. A question come to mind is: Is the earning growth of LAYHONG sustainable? I will discuss this aspect under Financial Summary section below.

Price Record
The long-term (2001-2011) price different of QL is about 10 times and LAYHONG is about 5 times, QL has better price growth prospect in long-term. The near-term (2010-2011) price different of QL is about 2 times and LAYHONG is about 3 times, LAYHONG has better price growth prospect and expect higher price volatility in near-term.

Financial Summary

QL's Financial Summary

LAYHONG's Financial Summary

By looking into detail of the financial summary of both companies, you should understood why investment community giving QL such a high valuation: It demonstrated consistence earning power and average return on equity around 20%.

It is right that LAYHONG has much better return in the past three years, but I have no clue about LAYHONG's ability to maintain it's grow momentum as it's business was sensitive to grain price such as corn and soya. A hike in price of grain will eat up LAYHONG's 3.5% profit margin.

Please take note that QL increase it's weighted average shares year on year, but the increment mostly via share-split and bonus issue where increment of weighted average shares of LAYHONG via private placement and options exercised of Executive Share Options Scheme (ESOS).

As conclusion, the ultimate winner of this comparison is QL.

How Much QL Worth?
Given the company CAGR of EPS is 15% (approximately 18.46% in the past 5 years) and Dividend Per Share is 12% in the next 10 years, the EPS of the company will be RM$0.317 in 2020 (included adjustment of 2 bad years in 10 which reduce 30% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$0.52 (included adjustment of 2 bad years).

If the stock price of QL sell at 15 times earning in 2021, it is RM$4.76 and included total dividends received, it is RM$5.28 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$5.28 discounted to today price, it is RM$3.13 per share.

The discounted price is merely 6.28% higher comparing to today (18 November 2011) closing price RM$2.93. I don't think the stock is undervalued at the moment, what do you think?

Analysis of TASCO Berhad

The author published the analysis report here is for his own reference only. It is not an indication of the author's business interests for companies being analyzed. It is definitely not an investment advice, please see the full disclaimer located at the bottom of the blog post.

Background Information From IPO Prospectus
TASCO Berhad (hereafter called "TASCO") listed in Bursa Malaysia on December 2007 is principally engaged as a total logistics solutions provider while its subsidiary companies are principally involved in the business of truck rental, in-house truck repair and maintenance, insurance agency services and warehouse rental as well as freight forwarding service providers and alliances with NYK Group for global logistics operation which comprises six core business divisions: Ocean, Air, Land, International Freight, Auto Logistics and International Network Solutions.

• Forecast of PE 7.43 times for FY 2008 based on EPS 14.8 cents.
• NTA per Share RM1.46 as at 31 August 2007
• Market Capitalization upon listing is RM110,000,000 based on RM1.10 issue price for 100,000,000 shares.
• Proceeds RM18.5 million mainly for the development of Bangi Logistics Centre to reduce storage constraints, lower down operation costs and enhance revenue, and acquisition of Port Klang Logistic Centre (PKLC) to strengthen market position as it contributed significantly Group's revenue and save on rental cost.

Operation Profit Margin (OPM)
In the latest annual report of TASCO, it's operation comprises the following six business divisions and two segments:

The international and domestic segment both have equal proportion on contribution to group's revenue of all reporting periods, but domestic segment contributed close to 80% operation profit in the recent years' financial result. It was understandable that the management focus on growing the domestic businesses as it has more stable operation profit margin compare to the international segment. However, as international segment is asset-light business, which required less capital commitment compare to domestic segment, the recent years' financial result may show that the management under-grow the business of this segment.

Financial Summary

The Compounded Annual Growth Rate (hereafter called "CAGR") of the Revenue of TASCO is average, 5.73%. Even with average growth of revenue, it still managed to achieve CAGR of Earning per share (hereafter called "EPS") about 18.9%. The management need to put more effort on growing revenue. The CAGR of Total Liabilities is about 13%, but it was still considered healthy as still achieve 6% margin compare to earnings growth rate.

Rate of Returns and Financial Leverages

TASCO achieved satisfactory of Return On Average Equity (hereafter called "ROAE"), average about 10% for the 5 years period, doing well especially in 2010, 12.2%. Return On Average Asset (hereafter called "ROAA") is moderate, in the range of 6.5% to 8.8%. The aspect which worth paying more attention is the financial leverages adopted by the company, which measured by Debt to Equity Ratio is below 40% except 2007, it show that the management is conservative on the use of financial leverages.

How Much It Worth?
Given the company CAGR of EPS is 10% (approximately 18.9% in the past 5 years) and Dividend Per Share is 6% in the next 10 years, the EPS of the company will be RM$0.26 in 2020 (included adjustment of 2 bad years in 10 which reduce 35% of group's net profit) and the forecast dividends received over the 10 years period totaling RM$0.77 (included adjustment of 2 bad years).

If the stock price of TASCO sell at 7.5 times earning in 2020, it is RM$1.97 and included total dividends received, it is RM$2.74 per share. Given annual 6% inflation rate in next 10 years, the discounted rate is 0.591898. So, RM$2.74 discounted to today price, it is RM$1.62 per share.

The discounted price is merely 4.58% higher comparing to today (25 October 2011) closing price RM$1.55. I don't think the stock is undervalued, what do you think?