Background

Media Chinese International Limited ('MediaC') is a Hong Kong-based investment holding company. The Company, and its subsidiaries, is engaged in the publishing, printing and distribution of Chinese-language newspapers, magazines and books, and the provision of travel and travel related services in Hong Kong, North America, Mainland China, Malaysia and Southeast Asia.

MediaC is listed on Bursa & Hong Kong Stock Exchange (code: 685).

Recent Financial results

MediaC has just announced its results for 3Q2010 ending 31/12/2009. For QE31/12/2009, its net profit increased by 56% q-o-q or 143% y-o-y to RM53.6 million while turnover increased by 4.8% or 5.8% to RM345 million.


Table 1: MediaC's 8 latest quarterly results

MediaC's abridged results as reported in USD for filing on the HKEx is:


Table 2: MedaiC's financial results (in USD) for QE31/12/2009 compared

The steady recovery in MediaC is clearly seen in the chart below.


Chart 1: MediaC's 8 quarterly results

Valuation

MediaC (closed at RM0.57 on Feb 25) is trading at a PER of 4.5 times (based on the annualized 3Q2010 EPS of 3.19). At this multiple, MediaC is deemed fairly attractive. Its fair value is about RM1.28 (based on PER multiple of 10 times).

Technical Outlook

MediaC is in a bottoming phase for the past 15-16 months, trading at prices between RM0.50 & RM0.65. It has yet to break above its long-term downtrend line, where the resistance is at RM0.60-62.


Chart 2: MediaC's weekly chart as at Feb 22, 2010 (Source: Tradesignum)

Conclusion

Based on a steady recovery in its financial performance & fairly attractive valuation, MediaC could be a good stock for long-term investment. As its technical outlook has yet to turned positive, one can accumulate this stock slowly.