Wednesday 1 October 2014

Hartalega

We are expecting the Group to maintain its net profit margin at around 20% despite bracing for headwinds of lower average selling prices (ASP) of gloves.


Earnings outlook/Revision

We lowered our earnings forecast for FY15F by 7% to factor in the lower average selling prices (ASP) of gloves as we expect that the increased competition in the nitrile gloves industry would keep selling prices subdued.

Double-digit earnings growth in FY16F. Earnings forecast for FY16F was nudged marginally higher by 1.5% as we update the installed production capacity figures for FY16. We are expecting FY16F earnings to grow by double-digit on the back of significant earnings contribution from NGC.


Valuation & Recommendation 

Maintain HOLD with a slightly higher target price of  RM7.00 (previous target price: RM6.98), following our upward revision of earnings for FY16F. We derive our target price by pegging FY16 EPS at PER of 16 times.

While we remain convinced on its growth prospect that underpinned by its expansion ahead, we still wary over the stiff competition in the nitrile gloves industry. Yet, we reckon that the high operational efficiency of the Group would aid to mitigate the adverse effect of lower ASP of gloves. Overall, we maintain our neutral view on the company.


JFApex Securities 30.9.2014



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No.
Financial   Revenue   Profit Before   Net Profit   EPS Div NTA
Quarter   (RM,000)   Tax (RM,000)   (RM,000)   (Cent) (Cent) (RM) Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History,Malaysia Stock - KLSE Quarter Report History
PBTM
1 30/06/2014   279,198   75,651   57,087   7.55 4 1.34 27.1%
4 31/03/2014   280,373   70,272   49,157   6.63 3.5 1.27 25.1%
3 31/12/2013   267,820   74,673   57,876   7.81 3.5 1.23 27.9%
2 30/09/2013   280,953   82,300   63,273   8.55 3.5 1.18 29.3%
1 30/06/2013   278,014   81,917   62,912   8.56 4 1.1 29.5%
4 31/03/2013   269,772   81,318   62,293   8.52 3.5 1.05 30.1%
3 31/12/2012   259,565   78,368   60,529   8.28 3.5 0.99 30.2%
2 30/09/2012   255,019   76,282   58,597   8.01 3.5 0.94 29.9%
1 30/06/2012   247,678   69,914   53,358   7.3 0 0.9 28.2%
4 31/03/2012   240,217   64,460   50,012   13.73 6 1.7 26.8%
3 31/12/2011   241,951   63,902   50,703   13.93 6 1.61 26.4%
2 30/09/2011   229,542   59,551   46,127   12.68 6 1.53 25.9%

1 comment:

random said...

hi bb,

Wilmar is at SGD3. Is it worth buying now?