For QE30/6/2013, Gtronic's net profit increased by 39% q-o-q or 46% y-o-y to RM14.1 million while its revenue increased by 10% q-o-q or 23% y-o-y to RM85 million. the company attributed its improved top-line and bottom-line to higher volume loadings from customers, better economy of scale, and improved productivity improvement & cost control program.
Table 1: Gtronic's last 8 quarterly results
Chart 1: Gtronic's last 25 quarterly results
Valuation
Gtronic (closed at RM2.60 yesterday) is now trading at a PE of 14 times (based on last 4 quarters' EPS of 18 sen). At that PE multiple, Gtronic is deemed fairly valued.
Technical Outlook
Gtronic has been in a steady uptrend after breaking above its strong horizontal line at RM1.30 in July 2012. The stock is presently trading in overbought territory and could face short-term profit-taking.
Chart 1: Gtronic's daily chart as at July 30, 2013 (Source: Quickcharts)
Conclusion
Based on good financial performance, Gtronic could be a good stock for long-term investment. Its upside potential is limited as it is trading at fair valuation.
Note:
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, Gtronic.
3 comments:
Hi
I wondering why many research house failed to highlight earning potential for YTL Power new project: 1 Bestarinet and contract to supply chomebook !?
Based om news report, YTL Power will supply 116,399 units chromebook and 2,839 unit Mobile lab to over 2000 secondary school under first phase,
Mobile lab cost RM 86,000 each: 2,839 unit x RM 86,000 = RM 244m
Chromebooks cost RM 1,255 each: 116,399 units x RM 1,255 = RM 146m
Based on 3Q result: PBT for Power generation (151m: profit margin 18%); Utilities/Power Seraya (507m: profit margin 5.8%); water and sewerage (506m: profit margin 27%); Brondband/1besterinet (loss RM 193m).
The loss in broadband attributed to reduce 17% of the total earning. According to YTL Power management, YTL broadband division is expect to breakeven by end of 2013. If materialize, YTLP without take into account potential future earning contribution from broadband, just alone breakeven already is earning enhancer by as much as 17% in EPS already.
In addition, YTL Power majority of earning contribute by oversea concession, currency appreciation UK pound and Sing dollar against ringgit, will add more earning to YTL P bottom line.
Hi Hng,
Thank you for the info.
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