Evergreen 5 years Revenue & Profit Trend

Evergreen 5 years Revenue & Profit Trend

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KLSE-Evergreen

Today Evergreen at RM0.48

EPS : -5.23
NTA: 1.61
DPS: 1.00
PE   : -9.18
ROE: -3.25
Market Cap: 246M

Evergreen still below 200MA. But RSI and MACD in + trend/territory.

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RHBInvest Research

Top Story: Evergreen Fibreboard – More headwinds Underperform

Visit Note

¨ After the global stock market rout in Aug, Evergreen stopped raising its product prices as its customers have generally turned cautious in their purchasing activities. Current orderbook visibility has dropped to about 1.5 months, compared to more than 2 months on average in the past.



Corporate Highlights



CMMT: No surprises Market Perform

3QFY11 Results / Briefing Note

¨ 3QFY11 realised net profit of RM27.6m (>100% yoy; +1.6% qoq) was in line with our and market expectations. A 1.98 sen DPU (+26.9% yoy) was declared. This brings 9MFY11 DPU to 5.88 sen, which is on track to meet our gross DPU forecast of 7.9 sen for FY11.

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RHBInvest Research

Top Story: Petronas Gas – Dividend payout assured despite cash outflow Market Perform

Visit Note

¨ Management echoed market expectations that gas supply should return to normal once the bypass from the damaged Bekok-C platform is completed by end-Sep.



Sector Call



Motor: On the rebound Neutral

Sector Update

MBM Resources: Fair value maintained at RM3.25 Market Perform

Tan Chong: Fair value maintained at RM5.50 Outperform

DRB-HICOM: Fair value maintained at RM2.95 Outperform

UMW: Fair value maintained at RM7.35 Market Perform

APM: Fair value maintained at RM5.10 Market Perform

Proton: Fair value maintained at RM2.50 Underperform



Corporate Highlights



Evergreen Fibreboard: Diversifying into solid timber Underperform

News Update

¨ Evergreen has entered into a share subscription agreement with Craft Master Timber Products S/B (CMTP), Lau Yng Yng and Lim Sock Ling to subscribe for 7,012,500 new ordinary shares in CMTP (equivalent to 51% stake) for RM7m cash. CMTP is a newly-incorporated company to carry out the business in manufacturing of solid wooden furniture parts and finger jointing.

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RHBInvest Research

Top Story: Top Glove – Latex prices set to ease further Underperform

Visit Note

¨ Latex prices have corrected sharply, in tandem with other commodity prices (excluding precious metals) amid concerns of weaker-than-expected economic growth. As such, we have reduced our latex price assumption to RM8.59/kg for FY11 (from RM8.69/kg earlier). Our latex price assumptions of RM7.75-7.90/kg for FY12-13 remain intact.



Sector Call



Property: Vietnam – Good prospect but not an easy market Neutral

Sector Update

¨ Vietnam has been a tough market. This is well known to many investors. The high inflation and lending rate imply that the required rate of return/IRR of any development projects must be at least 30% to make it profitable. The unfavourable economic indicators and the under-developed mortgage market have largely explained why many Malaysian developers have not been aggressive in pushing their launches in Vietnam during the recent property upcycle, when regional property markets are booming.



Corporate Highlights


no
Gamuda: Give me your best shot, comrades! Outperform

Visit Note

¨ MMC-Gamuda JV may have to settle for a low price for the tunnelling works if they have to match the ultra low winning bid from one of the two Chinese contractors, but we believe Gamuda could still optimise to improve profitability.



Notion Vtec: Shifting focus to camera and auto Underperform

Briefing Note

¨ Management appeared to have a more cautious tone on the industry outlook given the weaker-than-expected global economic growth. We understand although management has not witnessed any cut back in orders yet, the current environment poses a risk which could lead to slower-than-expected orders from customers. The HDD industry is not only facing weaker-than-expected IT spending for desktop PCs, it is also facing stiffer competition from tablets. Hence, we understand Notion will focus on the camera and automotive segments going forward.



SP Setia: Beranang? It’s far, but they will make it nearer Market Perform

News Update

¨ SP Setia entered into a SPA for the proposed purchase of a piece of 1,011-acre freehold land in Beranang for RM330m, or RM7.50 psf. The site is estimated to yield a GDV of RM3.5bn.The land is located midway between Semenyih, Bangi Old Town and Beranang. Travelling time is said to be about 40min to KL.



Evergreen Fibreboard: Going upstream into rubber plantation Underperform

News Update

¨ Evergreen has entered into a Mou with four individuals to purchase a 4,410-acre of land for RM37.8m. The land consists of tropical timber and approximately 1,730 acres of the area has been logged.



Dialog: On the mark Outperform

4QFY11 Results

¨ FY11 net earnings of RM152.4m were in line with expectations, rising 29% due to increased contribution from associate earnings (+23%) and better margins from core divisions of 13.4% (vs. 10.2% in FY10).



CSC Steel: 2QFY11 results dragged down by higher raw material costs Underperform

2QFY11 Results

¨ 1HFY11 net profit came in below expectations. We believe the variance against our forecast largely came from worse-than-expected margin contraction in 2QFY11 as a result of weak demand and significantly higher raw material costs.

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Evergreen will rebound?

Evergreen Daily Chart

This is one of the stock counter that I trade recently. Will Evergreen rebound? I just wait n see...

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RHBInvest Research

Regional Perspectives

• Top picks that are already regional champions (CIMB, Genting, KLK and MAHB) as well as those that have the potential to become so (SP Setia, Kencana and Dialog).

Sector Call


Semiconductor:

• Equipment orders continue to weaken
• Underweight

Unisem:

• Fair value maintained atRM2.31
• Market Perform

JCY:

• Fair value maintained at RM0.64 Underperform

MPI:

• Fair value unchanged at RM5.17 Underperform
  

Notion:

• Fair value unchanged at RM1.68 Underperform
• Maintain Underweight call on the sector.

KSL:

• A value pick
• Fair value is RM2.78.
• Outperform

Evergreen:

• Outperform
• To build a new glue resin plant in Gurun, Kedah
• Fair value is RM2.57

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