Results Update

Measat has just announced its results for QE31/3/2010. Its net profit increased by 78% q-o-q or 327% y-o-y to RM40 million while turnover increased by 12% q-o-q or 48% y-o-y to RM364 million. The improved performance was attributable to strong demand for passenger & commercial vehicles as well as the strengthening of the RM against the Japanese Yen, which lifted the operating margin. For the last 8 quarters' results & the highlights of the results for QE31/3/2010, see Taable 1 & 2 below.


Table 1: MBMR's last 8 quarterly results


Table 2: MBMR's financial highlights for QE31/3/2010 (Source: Link to the filling on Bursa Malaysia)


Chart 1: MBMR's 16 quarterly results

Valuation

MBMR (closed at RM2.70 yesterday) is now trading at a PER of 6.6 times (based on last 4 quarters' EPS of 41 sen). Price to Book is about 0.70 time. At these multiples, MBMR is deemed very attractive.

Technical Outlook

MBMR broke above its downtrend line at RM2.35 in October 2009. Thereafter, MBMR rose steadily- initially on a gradual uptrend line ('SS') and later accelerated (as per 'S1-S1'). The stock is now sliding back & it has just broken below S1-S1 at RM2.65. Its next support will be the horizontal line at RM2.50 and then the uptrend line, SS support at RM2.40.


Chart 2: MBMR's week chart as at May 17, 2010 (Source: Quickcharts)

Conclusion

Based on satisfactory financial performance and attractive valuation, MBMR could be a good stock for long-term investment. A good entry level could be at RM2.40-50.