Stock to review: LCTITAN (5284) Current Share price: RM2.23
This is one of the shares which I bought during MCO period around RM1 with 30,000 and sold it around RM2 subsequently. I remember this well. Nothing to shout about as some of you already net a few millions of gain (those whom I know).This is also a stock that many financial planner would recommend you if you were to build your own portfolio. This is consider a big cap stock and FYI usually big cap stock once its beaten down, the recovery it usually faster compare to mid cap stock. Alright lets begin.
Financial position - Excellent with Cash and Bank of almost RM4billion without any borrowings. Please look below for yourself.
Net operating cash flow of RM511mil from cash flow statement. Excellent. If you're following most of my articles I write, you will realised I always talk about cash. I don't usually talk about it but in terms of uncertainty you need to look into the Company whether they have enough buffer to sustain. Those that can go through this challenging period will emerge as winners after all these is over. For SME business do you know how hard it is without sufficient cashflow in this period with the amount of unemployment keep increasing? I hope you gain some insight. Just to add on the Company spent RM500mil in acquiring property, plant and equipment which is part of the utilisation of cash they got during he IPO for the funding of the below. If you can see the IPO price is RM6.50, now you can only get it for RM2.29 (at the time of my writting). So he initial investors must be cursing. Please note that the majority cash and bank in this Company is in IPO and all along they put in bank to make more money via interest. During last quarter when it was making losses many people say this Company is hopeless because it's making loss already in that quarter. But they did not notice the huge cash amount. The IPO investors must be cursing right now. RM6.50 IPO now you can buy for only RM2.29 which majority of proceeds during IPO is still inside the Company :)
Performance
Performance is getting better after the MCO, however still can be improved. They had turnaround during the current quarter after making loss in the last quarter. Revenue has been reduced but based on the commentaries in the latest quarter report they expect everything to normalised after Q2, which is as per this latest quarter. Having said that it seems they are trying to tell us that the performance should be back to normal after this. Average plant utilisation rate is 86% compare to 89% during last year same time. Not too bad.
Prospects - Things are improving but the variable below would affect the profitability of this Company. If this variable is favourable then we will see a better coming quarters ahead.
EPS given in current quarter is 3.9sens which is fairly good.
Conclusion:
Short to medium TP of RM2.50 respectively and RM3. Fair value is around RM4. However it will need to break RM2.50 first.
Disclaimer
This is one of the shares which I bought during MCO period around RM1 with 30,000 and sold it around RM2 subsequently. I remember this well. Nothing to shout about as some of you already net a few millions of gain (those whom I know).This is also a stock that many financial planner would recommend you if you were to build your own portfolio. This is consider a big cap stock and FYI usually big cap stock once its beaten down, the recovery it usually faster compare to mid cap stock. Alright lets begin.
Financial position - Excellent with Cash and Bank of almost RM4billion without any borrowings. Please look below for yourself.
Net operating cash flow of RM511mil from cash flow statement. Excellent. If you're following most of my articles I write, you will realised I always talk about cash. I don't usually talk about it but in terms of uncertainty you need to look into the Company whether they have enough buffer to sustain. Those that can go through this challenging period will emerge as winners after all these is over. For SME business do you know how hard it is without sufficient cashflow in this period with the amount of unemployment keep increasing? I hope you gain some insight. Just to add on the Company spent RM500mil in acquiring property, plant and equipment which is part of the utilisation of cash they got during he IPO for the funding of the below. If you can see the IPO price is RM6.50, now you can only get it for RM2.29 (at the time of my writting). So he initial investors must be cursing. Please note that the majority cash and bank in this Company is in IPO and all along they put in bank to make more money via interest. During last quarter when it was making losses many people say this Company is hopeless because it's making loss already in that quarter. But they did not notice the huge cash amount. The IPO investors must be cursing right now. RM6.50 IPO now you can buy for only RM2.29 which majority of proceeds during IPO is still inside the Company :)
Performance
Performance is getting better after the MCO, however still can be improved. They had turnaround during the current quarter after making loss in the last quarter. Revenue has been reduced but based on the commentaries in the latest quarter report they expect everything to normalised after Q2, which is as per this latest quarter. Having said that it seems they are trying to tell us that the performance should be back to normal after this. Average plant utilisation rate is 86% compare to 89% during last year same time. Not too bad.
Prospects - Things are improving but the variable below would affect the profitability of this Company. If this variable is favourable then we will see a better coming quarters ahead.
EPS given in current quarter is 3.9sens which is fairly good.
Conclusion:
Short to medium TP of RM2.50 respectively and RM3. Fair value is around RM4. However it will need to break RM2.50 first.
Disclaimer
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https://klse.i3investor.com/blogs/BabyAceStockAnalysis/2020-07-30-story-h1511440450-LCTITAN_5284_ATTACK_ON_THE_TITAN_Q2_RESULTS_BUY_TP_RM3_00_By_No_1_Analy.jsp
