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Tuesday, April 26, 2016

DLady: Quarterly Earnings At New High

Result Update

For QE31/3/2015, DLady's net profit increased by 34% q-o-q or 99% y-o-y to RM34 million while its revenue was mixed; dropped by 8% q-o-q but increased by 27% y-o-y to RM250 million. Revenue decreased by 8% q-o-q largely attributed to less selling days given the Chinese New Year festive period.  Profit before Tax increased by 33% driven by lower Cost of Goods and lower Distribution Expense.


Table 1: DLady's last 8 quarterly results


Chart 1: DLady's last 32 quarterly results

Historical Financial Results

From the 16 years' P&L accounts, we can see that there were 3 years where earnings surged. These are 2004 (when PBT surpassed the RM20-21 million mark); 2009 (when PBT surpassed the RM60-65 million mark); and possibly 2015 (when PBT surpassed the previous all-time high of RM186 million). These are highlighted in the table below (in green).

 
Table 2: DLady's last 16 years results

In the previous 2 occasions (2004 & 2009), the share price rallied strongly. Since the current breakout in earning (surpassing 2013 high), the chance of the share rallying is fairly good.


Chart 2: DLady's 16 years' Results & monthly chart as at April 25, 2016

Valuation

DLady (closed at RM54.00 yesterday) is now trading at a PE of 22 times (based on last 4 quarters' EPS of 247 sen). At this PER, DLady is deemed fairly attractive. Its DY is fairly decent at 4.1%.

Technical Outlook

We can see that DLady broke to the upside of its trading range of RM45.00 & RM49.00 in early 2016.


Chart 2: DLady's weekly chart as at Apr 25, 2016 (Source: Tradesignum)
 
DLady is in along-term uptrend line (SS), which accelerated since 2009 (s1-s1).


Chart 2: DLady's monthly chart as at Apr 25, 2016 (Source: Share Investor)

Conclusion

Based on improved financial performance, attractive valuation & positive technical outlook, DLady is rated a BUY.

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, DLady.

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