Cepatwawasan Group Bhd (‘Cepat’) is involved in the cultivation of oil palm & palm oil milling. Cepat owns about 10,000 hectares of oil palm estates located in
Financial Results
Due to the addition of the new estate in May & better prices for CPO, Cepat's topline & bottomline was given a healthy boost in the QE31/7/2007. Its net profit increased by 74% q-o-q or almost 3-fold to RM8.8 million, while turnover increased by 44% q-o-q or 74% y-o-y to RM47.1 million.
Valuation
If Cepat could maintain the same earning of 4.07 sen in QE31/7/2007 for the full year, its EPS would jump to 16.28 sen. Based on its closing price as at Sept 20 of RM1.10, Cepat would be trading at a PE of 6.7 times. That's very attractive for a plantation stock.
Technical Outlook
For the past 2 or 3 years, Cepat's share price has been trapped in a bottoming process known as the saucer bottom. A reversal is confirmed when the share price surpassed the reaction high that marked the beginning of the decline at the start of the pattern. In the case of Cepat, I believe that reaction high is RM1.15/16. In fact, this stock has surpassed that high before (in August), but the sharp rally could not sustain. Maybe, the next attempt would do the trick.
Chart: Cepat's weekly chart as at September 20 (courtesy of Quickcharts)
Conclusion
Based on good financial performance & very nice technical set-up, Cepat could be a good stock for a trade or for medium-term investment.
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