Stock Watch (TCHONG)

Company: Tan Chong Motor Holdings Bhd

Industry: Motor Vehicle

5yr Average ROE: 10.86%

10yr Average EPS Growth Rate: 20.45% 

10yr Average DY: 3.78% 

10yr Average P/E: 9.4

Dynaquest Rating: 6

Fair Value: RM 4.99

Tan Chong Motor is one of the biggest motor vehicle company in Malaysia. Based on their FY2009 report, the Group recorded total revenue and net profit of RM2.9 billion and RM153.3 million respectively after a recession of global proportions.

In the last quarter of fiscal year 2009, net profit of RM42.7
million is the first 51.6% year-on-year increase after four
consecutive quarters of decline. Revenues rose by 10.8%
to RM720.2 million in comparison to the same period in 2008.
Margins have begun to rise in earnest after four consecutive
quarters of decline. In particular, Q4 2009’s bottom line was
flattered by a stronger Ringgit. 

With the rise of vehicle sales in the 1st half of 2010, Tan Chong Motor is expected to perform well and EPS of 33 sen is expected.

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