Stock Review – AJIYA (7609) (AJIYA BERHAD) – 5

Bursa Malaysia - 7609

Bloomberg - AJY:MK
Yahoo - 7609 .kl
Webpage - http://www.ajiya.com/

Company Profile

AJIYA started as manufacturing metal roll products in 1990 and ventured into safety glass productions in1996. AJIYA holds 19 factories / warehouses with office throughout Malaysia and Thailand.

1) Geographical Location

AJIYA operated in two countries Malaysia and Thailand. Base on 2017 annual report, most revenue are coming from Malaysia operation which is 92.05 %.

The asset turnover ratio for Malaysia operation had reduce from 0.89 in 2016 to 0.82 in 2017. However the asset turnover for the Thailand operation had maintain at 0.53.

CONS:

è Asset turnover ratio for the Malaysia operation had reduce by 7.87 %

Financial Statement

The increase of inventories from RM 70,926,380 (2016) to RM 75,593,726 (2017), 6.58 % increase and decrease in trade and other receivables from RM 210,043,277 (2016) to RM 112,308,075 (2017), 41.77 % decrease had shown a sign of drop in sales. Besides that the revenue for AJIYA also decrease from RM 395,516,712 (2016) to RM 370,882,963 (2017), 6.23 % decrease.

AJIYA had increase in cash and bank balance from RM 56,404,655 (2016) to RM 75,372,329 (2017), 33.63 % increase. Besides that, AJIYA fixed deposit with licensed bank had also increase from RM 29,789,782 (2016) to RM 56,241,921 (2017), 88.88 % increase and the interest rate ranging from 3.53 % - 2.83 % in 2017 while the interest rate for fixed deposit with licensed bank ranging from 3.00 % - 3.95 %.

PROS:

è AJIYA had 33.63 % increase in cash and bank balance è AJIYA had 88.88 % increase in fixed deposit with licensed bank

CONS:

è 6.58 % increase in inventories, 41.77 % decrease in trade and other receivables and 6.23 % decrease in revenue had shown sign of reduce sales in 2017. AJIYA total loan and borrowing had reduce from RM 9,668,238 (2016) to RM 6,515,216 (2017), 32.61 % decrease. PROS: è AJIYA loans and borrowings had reduced by 32.61 % Financial Ratio Description 2017 2016 Different Gross Profit Margin 0.17 0.20 -0.03 Net Profit Margin 0.04 0.05 -0.01 Interest Coverage Ratio 45.94 27.68 +18.26 Effective Tax 0.17 0.22 -0.05 Warrant In 2016 AJIYA had issue free one warrant to every 2 shares with the exercise price of RM 0.92. The warrant can be exercised at any time on or after 1st September 2016 until 2021. As of 21 February 2017 157,292,242 warrant is available. PROS: è AJIYA warrant is way out of money compared to current price of RM 0.59. Dividend and Bonus Issued for the past five year AJIYA had constant dividend for the past five year from 2013 – 2017 with the average dividend of RM 0.011 after adjustment (2016 stock split) with the dividend yield of 1.86 % base on AJIYA stock price of RM 0.59 on 21/9/2018 . CONS: è AJIYA had dividend yield of average 1.86 % for the last five year which is lower than fixed deposit rate of 3.15 % Estimated Price IVKLS Price : RM 0.59 Peers 1)           ASTINO 2)           CHINHIN 3)           ENGTEX 4)           PGLOBE 5)           KIMHIN 6)           SCBUILD 7)           SEACERA 8)           SKBSHUT 9)           WOODLAN 10)                  WTHORSE         Summary of Stock Reviews

Stock Review – CHINWEL (5007) (CHIN WELL HOLDING BERHAD) - 3

Bursa Malaysia - 5007

Bloomberg - CWH:MK
Yahoo - 5007 .kl
Webpage - http://www.chinwell.com.my/

Company Profile

CHINWEL is a Malaysia based company which principle activities are manufacturing and trading of fastening and wire products.

1) Business Segment

CHINWEL had two business segments which are:

1. Fastening Products – 82.14 % of 2017 revenue

2. Wire Products – 17.86 % of 2017 revenue

According to the 2017 annual report fastening product has an asset turnover ratio of 0.82 while the wire products has an asset turnover ratio of 0.98. In 2017 CHINWEL has invested RM 8,208,997 in wire products non current assets compare to RM 5,162,576 for fastening products.

PROS:

è CHINWEL has invested more non current asset in high asset turnover ratio segment which is wire products.

2) Geographical Information

According to CHINWEL 2017 annual report, CHINWEL had revenue from four principle region as follows:

1. European Countries – 45.97 % of revenue

2. Malaysia – 36.63 % of revenue

3. Other Asean Countries – 9.44 % of revenue

4.  Others – 6.40 % of revenue

5. Vietnam – 1.56 % of revenue

According to CHINWEL 2017 annual report, currency profile of trade receivable is as follows:

1. US Dollar – 44.63 %

2. Ringgit Malaysia – 44.52 %

3.  Euro – 10.47 %

4. Vietnam Dong – 0.35 %

5.  Singapore Dollar – 0.03 %

PROS:

è CHINWEL trade receivable is dividing into US Dollar and Ringgit Malaysia.

Financial Statement

CHINWEL’s inventories had increase from RM 195,429,666 (2016) to RM 227,475,274 (2017), 16.40 % of increase. The inventories increase is mainly due to the increase of raw materials and indirect materials, RM 16,304,390 (23.19%) and RM 15,997,103 (266.96 %) respectively. However the finished good had decrease by RM 15,158,801 (17.06  %).

Of the RM 111,954,999 of trade receivables 28% of the trade receivable outstanding is from 2 customers.

CONS:

è Increase of inventories mainly due to increase of price of raw material and indirect materials. è Decrease of finished good despite increase of inventories. è 28% of the trade receivables from 2 customers

CHINWEL borrowing had decrease from RM 60,343,648 to RM 48,112,566, 20.27 % decrease in borrowing. RM 30,962,606 of the RM 48,112,566 borrowing for CHINWEL is in US dollar.

PROS:

è CHINWEL had 20.27 % decrease in borrowing

CONS:

è 64.35 % of the CHINWEL borrowing is in USD.

Financial Ratio 

Description	2017	2018	Different
Gross Profit Margin	0.18	0.21	- 0.03
Net Profit Margin	0.10	0.12	- 0.02
Interest Coverage Ratio	58.75	61.08	- 2.33
Effective Tax	0.18	0.15	0.03

Dividend and Bonus Issued for the past five year

CHINWEL had constant dividend for the past five year from 2013 – 2017 with the average dividend of RM 0.0579 with the dividend yield of 3.57 % (base on closing price 7 September 2018 RM 1.62).

PROS: è CHINWEL has dividend yield of 3.57 % which is higher than fix deposit rate of 3.15%

Market Research

ZJ RESOURCE (28 August 2018)

Price Target : RM 1.90

• The fastener sector had increase in earning due to higher profit margin
• Malaysia and European countries remain the largest contributors of revenue, making up of 77% of revenue.

MALACCA SECURITY SDN BHD (28 August 2018)

Price Target : RM 1.85

• Weaker margins seen in the wire segment due to sharp increase in raw materials prices and a forex loss.

Estimated Price

IVKLS Price : RM 1.35

Peers

1)   SAM

2)    CBIP

3)    RAPID

4)   TONGHER

5)   HCK

6)   DUFU

7)   GLOTEC

8)   UNIMECH

9)      MBL

10) SCH

Summary of Stock Reviews

Stock Review – CYL (7157) (CYL CORPORATION BERHAD)

Bursa Malaysia - 7157
Bloomberg - CYLC:MK
Yahoo - 7157 . kl

Webpage - http://www.cylcorporation.com/

Company Profile

CYL principally involved in the business of manufacturing and supplying of plastic packaging product. CYL caters blow  molded plastic products to automotive lubricants industries.

Financial Statement

CYL trade receivable had decrease from RM 13,519,384 in 2017 to RM 12,299,868, 9.02 % decrease however there is also a decrease in trade receivable past due but not impaired a well from RM 2,657,576 to RM 1,718,319. These has made the trade receivable neither past due nor impaired for 2018 is RM 10,581,549 only decrease by only 2.58% compared to RM 10,861,808 in 2017.

In 2018 annual report, there is other investment RM 1,505698. These other investment representing investment in a Shariah-compliant money market fund which is managed by a local financial institution.

PROS:

è 35.34% decrease in trade receivable past due but not impaired in 2018

CYL does not had any borrowing.

PROS:

è CYL does not had any borrowing

Financial Ratio

Description	2018	2017	Different
Gross Profit Margin	0.39	0.42	- 0.03
Net Profit Margin	0.02	0.04	- 0.02
Interest Coverage Ratio	N/A	N/A	N/A
Effective Tax	0.27	0.12	0.15

Dividend and Bonus Issued for the past five year

CYL had constant dividend for the past five year from 2013 – 2017 with the average dividend of RM 0.051 with the dividend yield of 8.79 % (base on closing price 7 September 2018 RM 0.58).

PROS: è CYL has dividend yield of 8.79 % which is higher than fix deposit rate of 3.15%

Market Research

None

Estimated Price

IVKLS Price : RM 0.18

Peers

1)   SCIENTIX

2)   ATAIMS

3)   KIANJOO

4)   MCT

5)   DAIBOCI

6)    PERSTIM

7)   SLP

8)   TGUAN

9)   SCGM

10) IRETEX

Summary of Stock Reviews