DLady- Top-line and bottom-line slipped

Result Update

For QE31/3/2013, DLady's net profit dropped
14% q-o-q but rose 6% y-o-y to RM29 million while its revenue dropped
by 9% q-o-q or 4% y-o-y to RM206 million. The decline in revenue was
contributed by lower sales of powder and liquid products. This in turn
led to lower bottom-line when compared to the immediate preceding
quarter.

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Table: DLady's last 8 quarterly results

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Chart 1: DLady's last 20 quarterly results
Valuation

DLady
(closed at RM48.50 yesterday) is now trading at a PE of 25 times (based
on last 4 quarters' EPS of 195 sen). With the earning growth rate
slowing from 50% a year ago to 16%, DLady's PEG ratio is now well over
1 times. Thus, the valuation for this stock is deemed expensive.

Technical Outlook

DLady
is still in an uptrend line with support at RM45.00-45.50. If the share
price were to break below this uptrend line, DLady will then move
sideway, with support at RM40.00.

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Chart 2: DLady's weekly chart as at May 29, 2013_12.30pm (Source: Quickcharts)

Conclusion

Based
on demanding valuation, DLady is to be avoided. Since the stock is
still in an uptrend line, those holding the stock may choose to SELL
INTO STRENGTH for now.

Note:
In
addition to the disclaimer in the preamble to my blog, I hereby confirm
that I do not have any relevant interest in, or any interest in the
acquisition or disposal of, DLady.

Author: Alex Lu