Friday, January 27, 2012

Zhulian- poised to test its all-time high of RM2.00

Results Update

Zhulian has recently announced its results for QE30/11/2011. Its net profit increased by 18.4% q-o-q or 18.6% y-o-y to RM28.8 million while turnover eased off 5.4% q-o-q but rose 2.3% y-o-y to RM86.8 million. The improved bottom-line was attributed to higher share of profit from an equity-accounted investee of RM792k and forex gain.


Table: Zhulian's last 8 quarterly results



Chart 1: Zhulian's last 21 quarterly results

Valuation

Zhulian (closed at RM1.97 today) is now trading at a PE of 9.4 times (based on the last 4 quarters' EPS of 20.9 sen). For a company with a CAGR of about 10%, Zhulian's PEG of about 1 time is deemed fair.

Technical Outlook

Zhulian has slowly risen steadily in the past few weeks. It is poised to test its recent high of RM2.00 soon. If it can break above the RM2.00 mark, Zhulian's uptrend could continue.


Chart 2: Zhulian's weekly chart as at Jan 27, 2012 (Source: quickcharts)

Conclusion

Based on good financial performance and fair valuation, Zhulian is rated a HOLD. If the stock were to break above the RM2.00 mark, it may be a good trading BUY.

5 comments:

小金币 said...

Hi Alex, can I know what is share of profit from an equity-accounted investee mean?

Thanks.

Rei said...

Hi alex ,
Seeing the current market weakening , I think it would be a bit risky for trading buy when she broke out .

Btw happy Chinese new year ,
reiccs.blogspot.com

cheer said...

Hi Alex,

Pelikan recover?

Alex Lu said...

Hi cheer


Pelikan need to go above RM0.90. It is still in a bottoming phase.

Kong Hui CHONG said...

Hi Alex,

Happy Dragon Year!

Is ZHULIAN now Fully Valued or Under valued?

I believe it is definitely not overvalued.

Based on price of RM2.00 and 12 sen dividend per year (paid quarterly) the DY of 6%p.a. seem still attractive to dividend-lover.