PICORP (7201) attract my logic trading analysis attention because
this company have been quite shy in BURSA MALAYSIA market for some time
but it's actually a very healthy, nett cash company, and doing UNIQUE
business ! And many excitement found in this company. Lets have some
introduction :
Progressive Impact Corporation Berhad, strength
lies in its position as an “Integrated Environmental Solutions
Provider”, offering a wide range of services ranging from environmental
consultancy & monitoring, waste water treatment & solution,
laboratory analysis and ocean data monitoring.
PICORP Vision
To be a world class business organization focused on cost effective environmental solutions which shall benefit mankind.
PICORP Mission
To be a world class business organization providing innovative
technology & quality products and services in the field of
Environmental Solutions for local and overseas markets through a team of
highly motivated, competent and quality employees.
PICORP Way Values
Serving Allah, Respect for the people & the environment
Lets look at how is this company past 5 year doing. WOW pretty impressive right ! Its increasing year by year :)
Latest quarter result also show improving compare to last year first quarter. Inside quarter result, they mention they manage to reduce cost, therefore higher profit for the quarter !
After checking latest balance sheet, company cash increase to 40 Million
!! equal to about 0.06 cent ! Share price only 0.2+ ! The company only
have about 3.9mil short term borrowing, therefore its 100% nett cash
company which is most favorable by value investor. Because no big loan =
zero risk. Company can sustain well when dont have any huge amount of
long/short term loan. Because if loan a lot, then have to pay interest,
then all earning will gone for interest.
What is more exciting to shareholder if invest into PICORP??? WOW look at the dividend payment. Almost every year 2 time consistently. How is the yield? You wont believe it ! Its better than buy DIGI !
Take year 2014 alone, dividend is 0.0065+0.0061= RM 0.0126.
Share price of PICORP averagely in year 2014 around RM 0.25
DIVIDEND YIELD = RM 0.0126/RM 0.25 X 100% = 5.04 % !!
If the Calculate Dividend Yield Return at 3.5% should price should at least RM 0.35.
Such a small company but dividend return as high as 5% ! What if they pay more in coming years? Would the share price maintain at only around 0.20+ ?
High Dividend yield return say its should at least go above 0.30 + !
If that is the case, how much potential capital gain if I enter now? Its
about 37% + ! To set cut loss at 0.215, risk reward ratio is about 1 :
5.3. Upside potential gain 8 cent while lose only 1.5 cent.
What is more interesting? By looking at this company total share based on 2014. Its about 658,000,000 shares. Minus Largest 30 shareholders share 568,893,345 left 8,910,6655 shares. What it mean? Lets try calculate :
8,910,6655 X RM 0.235 = RM 20,940,063.925. ?? 20 Million worth of share is floating at market. Maybe some retailer is keeping since long time? And never plan to sell? Lets just minus 30%, its only RM 14 Million of shares that might be fighting around at market. Which is very small and very easy to controlled and fried up. (if you check, second largest shareholder is LEMBAGA TABUNG HAJI 9.878 % and over the year they never sell! Their shareholder also keep buying last year)
Why would buaya might fried up the shares? Any reason? Yes ! Lets look at what Government announce recently! Government to allocate RM 15 billion for Green Tech in coming Malaysian Plan 11 !!! Lets us do simple logic analysis on this allocation.
RM 15 Billion / 5 year (Malaysia 11 plan for 2015-2020) = RM 3 Billion a year.
Lets count if this company benefit 1% only from this plan:
RM 3 Billion X 1% = RM 30 Million.
RM 30 Million / 4 quarter = 7.5 Million !!
Will company gain more from just 1 % ?? Lets look at recently announcement news ! PICORP has bagged an extension of concession agreement for an interim period of one year worth RM22 MILLION from Ministry of Natural Resources and Environment (NRE). Refer HERE: <--- br="">
Not to forget that its just the beginning of the year ! It already show not just 1% More to comes !
PICORP Not only presence in Malaysia, they also have business in INDONESIA, and SAUDI ! I believe more and more company, government need their services !
You can find more detail of their business in their coporate presentation HERE : <--- br=""> (pjbumi already sold off)
As a conclusion:
1. Picorp is a cheap company with good FA
2. Picorp payout good dividend return every year.
3. Picorp business have growth potential and benefit from MP 11
4. Picorp business is very unique and no much competitor so far
My Target for Picorp
First TP 0.28, Second TP 0.32 Third TP 0.40.
PICORP (7201)
Bursa Stocks Logic Trading Analysis
