Thursday, July 18, 2013

Zhulian- bottom-line continued to rise

Result Update

For QE31/5/2013, Zhulian's net profit increased 28% q-o-q or 30% y-o-y to RM38 million while revenue dropped 2% q-o-q or 4% y-o-y to RM106 million. Top-line declined due to drop in local sales. Nevertheless, bottom-line improved due to the increase in share of profit of equity-accounted investee, which had more than off-set the decline in operating result (due to lower sales).

Table: Zhulian's last 8 quarterly results

Chart 1: Zhulian's last 27 quarterly results 


Zhulian (closed at RM3.10 yesterday) is now trading a PE of 11 times (based on last 4 quarters of 27.7 sen). Its PEG ratio is about 0.7 time (based on earning CAGR of at least 15%). As such, Zhulian is still deemed attractive.

Technical Outlook

Zhulian's uptrend continued after it broke above the horizontal line at RM2.90 May. ts immediate resisatnce is at the recent high of RM3.28-3.30. Its immedaite support is at the psychological RM3.00 level, which coincides with the uptrend line, S1-S1.

Chart 2: Zhulian's daily chart as at July 17, 2013 (Source: quickcharts)

Chart 3: Zhulian's weekly chart as at July 17, 2013 (Source: quickcharts)


Based on good financial performance, attractive valuation & positive technical outlook, Zhulian is still 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, Zhulian.

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