tag:blogger.com,1999:blog-58146605549626373472024-03-13T21:41:59.375-07:00stock business opportunityMr. Nonghttp://www.blogger.com/profile/00338763258281464396noreply@blogger.comBlogger1125tag:blogger.com,1999:blog-5814660554962637347.post-2010155079960283072009-05-27T03:06:00.000-07:002009-05-27T03:13:23.888-07:00Kim Eng Stock Business Opportunity Recommends Hold IRCInoue Rubber (Thailand) (IRC) - HOLD <br /><br />Price (Bt) 8.35<br />Target (Bt) 9.00<br />Set Index 556.47<br /><br />2Q09 earnings down less than the industry <br /><br />2Q09 earnings fall to Bt42mn (-38% qoq, -49% yoy)<br /> Inoue Rubber (Thailand) (IRC) reported a weak 2Q09 (Jan – Mar 2009) <br /><br /><a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgZW09rYIXgde_-hAGXJR7IaCJVcUVFHoHmoaDkZO27i2_NbJqRTo2dU4OWPoV8o3eOuUHZOLwhiU9et7A8mZcIADlCl6DHIayX-jkrVMMiep9C6utvWap2_Nw9Vk6x4IwF-LpCYlQOaQg/s1600-h/stock-market.jpg"><img style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;width: 320px; height: 240px;" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEgZW09rYIXgde_-hAGXJR7IaCJVcUVFHoHmoaDkZO27i2_NbJqRTo2dU4OWPoV8o3eOuUHZOLwhiU9et7A8mZcIADlCl6DHIayX-jkrVMMiep9C6utvWap2_Nw9Vk6x4IwF-LpCYlQOaQg/s320/stock-market.jpg" border="0" alt="stock business opportunity"id="BLOGGER_PHOTO_ID_5340444543925058402" /></a><br />net profit of Bt42mn (EPS Bt0.21), down 38% qoq and 49% yoy. Although a slump in earnings, this level of net profit is still impressive when compared with the industry after auto production has slumped by 46% and motorcycle production is down 20%. IRC sales were Bt937mn, down 36% qoq and 32% yoy. This fall was less than the industry as IRC sales are diversified into 1) industrial elastomer products and 2) motorcycle tires and tubes in all three sectors (OEM, replacement and exports). The gross margin was still good at 10% compared with 10-11% previously, although production was at a low utilisation with lower raw material costs. Sales and administrative expenses were down to Bt44mn (-37% qoq, -20% yoy) from good expense controls and interest was a low B3mn.<br /><br />Further revision as crisis deepens more than previous forecast<br /> The world financial crisis has widened and has severely impacted Thai auto production, which has <br />fallen 40-50% for domestic autos and exports falling by 30%. This fall has been more severe than our report <br />of Feb 11, 2009. We are therefore revising down our earnings projection. However, in the second half of <br />this year, after inventory stocks have been cleared, we expect production to return to the same level as <br />sales (down yoy 30%). Motorcycle production is expected to fall by around 20%. Overall, we have forecast <br />the 2009 sales at Bt4,600mn, down 19% yoy and earnings to fall to Bt206mn (EPS Bt1.03), down 26%.<br /><br />Maintain HOLD with next quarter down much less <br /> The current IRC price of Bt8.35 has strongly increased from low at Bt5.5 by 55% from the market <br />view that the auto industry will pass the low production level in the second quarter. The current share <br />price is trading on a 2009 PER of 8.1x with an EV/EBITDA of 3.5x and below the book value of Bt8.6. We are <br />maintaining our fair value of Bt9 based on a 2010 PER of 7-8x. Overall, we maintain our recommendation of <br />HOLD.<br /><br />Earnings summary<br />Year End Sep 30 2006 2007 2008 2009F 2010F <br />Sales (Btmn) 4,512 4,882 5,648 4,600 5,060<br />EBITDA (Btmn) 407 571 536 485 533<br />Earnings (Btmn) 172 293 277 206 240<br />EPS (Bt) 0.86 1.46 1.39 1.03 1.2<br />PER (x) 9.7 5.7 6 8.1 7<br />EV/EBITDA (x) 5.2 2.9 3.5 3.5 3.1<br />CF/share (Bt) 3.3 1.4 2.9 2.2 2.5<br />BVPS (Bt) 5.9 7.1 8 8.6 9.4<br />P/BV (x) 1.4 1.2 1 1 0.9<br />DPS (Bt) 0.29 0.48 0.45 0.36 0.42<br />Dividend yield (%) 3.50% 5.70% 5.40% 4.30% 5.00%<br />Net debt/Equity (x) 0.4 0 0.1 0 Cash <br />ROA (%) 11.00% 9.50% 6.90% 8.40% 9.00%<br />ROE (%) 22.40% 18.30% 12.40% 13.30% 13.20%<br />Source : Company reports and KELIVE Research estimates. <br /><br /> By Kim Eng Securities (Thailand) Company Limited on May 20, 2009<br /><br /><a onblur="try {parent.deselectBloggerImageGracefully();} catch(e) {}" href="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjJ-RrF9a4ZEAYd7nJGRhBpiLRn_TuMgRMOJ8Cb-zr3VXLzGA1DGQxPhiVI2EHaCnWzH1ITahjlbEWybHThvyj6LiodAYLv5t0FoJ-8G0R8dp47Bbjeg0WP7mbBJNF43jsa8eCsshHRjc0/s1600-h/stock-trading.jpg"><img style="display:block; margin:0px auto 10px; text-align:center;cursor:pointer; cursor:hand;width: 320px; height: 214px;" src="https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjJ-RrF9a4ZEAYd7nJGRhBpiLRn_TuMgRMOJ8Cb-zr3VXLzGA1DGQxPhiVI2EHaCnWzH1ITahjlbEWybHThvyj6LiodAYLv5t0FoJ-8G0R8dp47Bbjeg0WP7mbBJNF43jsa8eCsshHRjc0/s320/stock-trading.jpg" border="0" alt="stock business opportunity"id="BLOGGER_PHOTO_ID_5340443419513526018" /></a><br /><span style="font-weight:bold;">USA Major Cities</span><br /><br />Charlotte North Carolina ,Houston Texas ,El Paso Texas ,Garland Texas,Stockton California,Akron Ohio,Toledo Ohio,Bakersfield California,Honolulu Hawaii,Raleigh North Carolina ,Minneapolis Minnesota,Washington District of Columbia,Durham North Carolina ,Birmingham Alabama,Austin Texas,Wichita Kansas ,St. Paul Minnesota ,Omaha Nebraska,Orlando Florida,Las Vegas Nevada ,Indianapolis Indiana,Chicago Illinois ,Chesapeake Virginia,Oyster Bay New York,Tucson Arizona,Riverside California,Tulsa Oklahoma,North Hempstead New York,Phoenix Arizona ,Memphis Tennessee,Virginia Beach Virginia ,Chandler Arizona,Los Angeles California,Fort Wayne Indiana ,Tampa Florida,Greensboro North Carolina ,Lubbock Texas,Nashville-Davidson Tennessee,St. Louis Missouri ,Corpus Christi Texas ,Long Beach California ,Lexington-Fayette Kentucky,Dallas Texas ,Baton Rouge Louisiana ,Rochester New York ,Milwaukee Wisconsin,Portland Oregon ,San Francisco California ,Denver Colorado,Miami Florida,Philadelphia Pennsylvania ,Cleveland Ohio,Fort Worth Texas ,Modesto California,Madison Wisconsin,Cincinnati Ohio,Oakland California,San Diego ,Columbus Ohio,Arlington Texas ,New Orleans Louisiana ,Laredo Texas,Plano Texas,Lincoln Nebraska,Kansas City Missouri ,Babylon New York ,Sacramento California,Chula Vista California ,Jersey City New Jersey,Boston Massachusetts,Henderson Nevada,Anchorage Alaska,Jacksonville Florida,Reno Nevada,Oklahoma City Oklahoma ,Glendale Arizona,St. Petersburg Florida ,Fresno California,Aurora Colorado,Norfolk Virginia,Newark New Jersey ,Albuquerque New Mexico ,Scottsdale Arizona,Detroit Michigan,Pittsburgh Pennsylvania,Colorado Springs Colorado ,Mesa Arizona,Hialeah Florida,San Antonio Texas,Hempstead New York ,Atlanta Georgia,San Jose California ,Santa Ana California ,Islip New York ,Seattle Washington,Anaheim California,Brookhaven New York ,New York New york,Buffalo New York ,Baltimore MarylandMr. Nonghttp://www.blogger.com/profile/00338763258281464396noreply@blogger.com0