Wednesday, June 12, 2013

NTPM- a consumer stock worth close tracking

Result Update

For QE31/1/2013, NTPM's net profit increased by 13% q-o-q but dropped by 4% y-o-y to RM13.8 million while revenue increased by 8% q-o-q or 10% y-o-y to RM128 million. The increase in revenue and profitability is mainly due to the contribution from sales of baby diapers.

(Note: NTPM will be announcing its results for QE30/4/2013 in the next few days.)

Table: NTPM's last 8 quarterly results

Chart 1: NTPM's last 30 quarterly results

New Investment in Vietnam

NTPM has incorporated a subsidiary, NTPM (Vietnam)  to undertake the business of manufacturing, processing tissue paper and products related to tissue paper and manufacturing semi-finished paper rolls. To carry on this business, NTPM has invested USD4.95 million to acquire a piece of land measuring 100,000 square meters in Vietnam Singapore industrial Park (“VSIP”) II in Binh Duong province, Vietnam.


NTPM (closed at RM0.535 yesterday) is now trading  at a PE of 12.4 times (based on last 4 quarters' EPS of 4.3 sen). At this PE multiple, NTPM is deemed fairly valued.

Technical Outlook

NTPM has broken above its intermediate downtrend line at RM0.46 in March this year. In May, it broke above its horizontal resistance at RM0.49-0.50. With these breakouts, NTPM is expected to enter into its next upleg. See Chart 2 below.

Chart 2: NTPM's daily chart as at June 12, 2013_12.30pm (Source: Quickcharts)

From the monthly chart, we can see that NTPM may have established another long-term uptrend line (S-S1) after breaking below its earlier ling-term uptrend line (SS).

Chart 3: NTPM's weekly chart as at June 11, 2013 (Source: Tradesignum)


Based on improving financial performance, fair valuation & potentially positive technical outlook, NTPM could be a stock worth close tracking. If the result for QE30/4/2013 shows continued or further improvement, the stock could be a good stock for long-term investment.

In addition to the disclaimer in the preamble to my blog, I hereby confirm that I do not have any relevant interest in, or any interest in the acquisition or disposal of, NTPM.

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