0732 TRUELY INTL. (C)
overall rate: C

Current market value: 3540m
As of Jan-19-2007, price = 7.55, PE/G = 5.35
Bargain Price: price below 6


earning equity ROE
06 Sep. 496 2341 21%
05 702 1938 36%
04 527 1407 37%
03 193 995 19%
02 104 864 12%

06 earning estimation: 496 * 1.333 = 661m
Reasonable market value: 661 * * (pe=8) + 1019 (NCAV) = 6307m
Reasonable price: 6307/468 = 13.47

John Neff Criteria:
1. Sound balance sheet: B
2. Satisfactory cash flow: C
3. Above average ROE: A
4. able management: unknown
5. prospect of continued growth: unknown
6. Attractive product or service: B
7. A strong market in which to operate: A
8. corporate government: season report

John formula: (earning growth rate + yield)/PE - what you get for what you pay - terminal relationship figure.
(0 + 6.35) / 5.3 = 1.19 < John's fund 2.3

借貸總額為592,000,000港元，其中347,000,000港元須於一年內償還，其
餘則須於兩至三年內償還. 未來三年將用作購置物業、廠房及設備之已授權但未訂約資本支出約20億港元，預期資金
來源大致上來自內部儲備。

務LCD顯示器及相關產品的生產及分銷佔綜合營業額的比率進一步上升至
97%. TFT面板生產線於二零零七年年初投入大規模生產.第三代流動電話即將推出，全球定位系統（「GPS」）獲得中國駕
駛人士廣泛使用，我們相信該重要地區分類將於本集團短期及中期業務及盈利能力增長方
面扮演關鍵角色。

能源價格持續高企、勞工成本及生產開支

Dividend payout trend: go down or stay at 30%.
3-5 year prospect: may same as now
long term prospect: can't foresee

12/2005 12/2004 12/2003 12/2002 12/2001 Current Ratio (X) 1.79 1.95 1.39 1.77 1.42 Quick Ratio (X) 1.34 1.36 0.92 1.24 0.86 Long Term Debt/Equity (%) 12.88 15.86 9.24 7.49 4.10 Total Debt/Equity (%) 22.26 30.07 38.74 28.18 29.60 Total Debt/Capital Employed (%) 19.39 25.65 34.93 25.72 28.45 Return on Equity (%) 36.22 37.40 19.36 12.01 7.29 Return on Capital Employed (%) 31.54 31.90 17.45 10.97 7.01 Return on Total Assets (%) 20.48 21.86 11.13 8.28 5.23 Operating Profit Margin (%) 18.41 17.84 16.69 12.95 9.47 Pre-tax Profit Margin (%) 18.40 17.84 16.74 12.97 9.47 Net Profit Margin (%) 15.35 15.45 13.76 12.12 8.81 Inventory Turnover (X) 8.32 7.65 4.81 5.21 4.18 Dividend Payout (%) 31.14 34.03 43.82 51.35 58.06 Fiscal Year Highest Price (HKD) 12.050 12.200 8.250 3.100 4.325 Fiscal Year Lowest Price (HKD) 7.850 7.500 2.350 2.000 1.600 Fiscal Year PER Range (X) 7.8/5.1 10.4/6.4 19.0/5.4 13.3/8.6 31.4/11.6 Fiscal Year Yield Range (%) 6.1/4.0 5.3/3.3 8.1/2.3 6.0/3.9 5.0/1.8

0328.HK 爱高

PE	EPS growth (%)	ROE (%)	Earning growth (%)	Current ratio (X)	Debt/equity (%)	NCAV (M)	Market Cap.
6.64	15.6	19.88	18.25	1.95	22.52	876	1886

Criteria 1:

Year	Earning		Dividend	Equity	R.O.E
2006 forcast	163 * 2
2005	283	17.9%		1426	19.8%
2004	240	61%		1284	18.7%
2003	149	8.7%		1101	13.5%
2002	137	38%		1008	13.5%
2001	99			915	10.8%
2000	83			840	9%
1999	88			771
1998	88			699
1997	42			633

Current Actual PE = Market Cap – NCAV = (1886 – 875) / 283 = 3.5

Intrinsic Value Estimation:

(1). NCAV + 5 YEAR AVG PE-2006

= 2731 – 1802 – 54 + 12 * 137 * 2

= 875 + 3288 = 4163 m

(2) NCAV + 5 YEAR AVG PE-2005

= 875 + 283 * 12 = 4271 m

Divided payout: Very good record

Corporate governance: as David webb invested in this stock, it should be fine

Business prospect: TBD

Company buyback – good signal

TBD

0647 JOYCE BOUTIQUE (B-)

Earning Equity R.O.E
06* 70
05 74 437 16.91%
04 61 390 15.66%
03 30 325 9.31%
02 -35 294 /
01 -85 329 /

Profit margin: 9.5%
Financial position: Very Strong - 253m cash, no liab
Business prospect: earning can be sustained in future 5 - 10 years unless management problem happen
reasonable price: NCAV 282 + 70 * 10 = 982m / 1620m = 0.606
Current price: 0.34

John Neff formula: (5?+ 5.97 )/7.33 =

03/2006	03/2005	03/2004	03/2003	03/2002
Current Ratio (X)	3.45	2.98	3.14	3.08	3.22
Quick Ratio (X)	2.35	2.15	2.39	2.31	2.33
Total Debt/Equity (%)	0.34	0.00	1.61	3.10	1.77
Total Debt/Capital Employed (%)	0.34	0.00	1.61	3.10	1.77
Return on Equity (%)	16.91	15.66	9.31	NA	NA
Return on Capital Employed (%)	16.91	15.66	9.31	NA	NA
Return on Total Assets (%)	12.75	11.01	6.69	NA	NA
Operating Profit Margin (%)	9.74	8.56	6.02	NA	NA
Pre-tax Profit Margin (%)	10.18	8.56	6.02	NA	NA
Net Profit Margin (%)	9.79	9.66	5.57	NA	NA
Inventory Turnover (X)	4.81	4.65	5.76	5.79	4.97
Dividend Payout (%)	43.76	52.63	NA	NA	NA
Fiscal Year Highest Price (HKD)	0.790	0.670	0.630	0.197	0.210
Fiscal Year Lowest Price (HKD)	0.380	0.230	0.085	0.070	0.120
Fiscal Year PER Range (X)	17.3/8.3	17.6/6.1	33.3/4.5	NA	NA
Fiscal Year Yield Range (%)	5.3/2.5	8.7/3.0	NA	NA	NA

My Approach

Approach: Discover great company with substantially under value

Criteria for great company:
1. ROE>15%, EPS growth>15% in last 3-5 years
2. Sound balance sheet

3. Future analysis:
can be performance be sustained in the feature 3, 5 and 10 years?
- can the growth rate, ROE be sustained

4. Under value

Market value < 2/3 NCAV, the little the better.


TO DO JOBS

1. Suppose I am at year 2003, if i applied this approach, what are the performance of those stocks that i will buy?