Ioi Corporation

IOI Corporation face Study 1. IOI strong growth was achieved through a. Good plantation circumspection practice * Continues improvements on yields performance * Maximize output from plantation and factories and pick at input to achieve a low-cost supply chain b. diversify business base in touch crude application, from downstream orbit to upstream sector 2. IOI opportunities and threats c. Opportunity * Continues growth on palm anoint in edible oils & fats market globally * Increase in non-food industry claim, like biofuel.Now, market is focus on renewable energy. Palm oil has been identified as one of the efficient and clean biofuel * Crude palm oil price getting higher(prenominal) and stable form-on-year. * gross revenue of properties at prime area especially in Singapore have been back up * Expansion in Indonesia with recent planting permit approval to the convocations directly owned plantations d. Threat * Major revenue is semen from export markets to Europe and US. W eak economic situation affect the demand on palm oil. With limited land bank in Malaysia * reproving weather condition * Shortage of estate workers * Fierce competition from Sime Darby and Indonesia and forthcoming markets like Africa and Brazil are catching up 3. Internal brass instrument capabilities and it weakness. e. Top 3 executive directors are family members. Decisions making are among family members, higher chances in power abusing and lack of transparency f. Has operations in numerous countries, expose to foreign exchange risk 4. deviate and unchanged g. Change Family based share holders lack of transparency. Need to maintain good family with stakeholders to increase the efficiency of the group h. Unchanged * Tissue culture research, jumper cable to cultivation of clonal palms with superior traits * Continuous improvement in productiveness and efficiency of its operations * Sustainable environmental friendly practices IOI Financial analytic thinking FY2012 1. Curre nt liquidity ratio = Current asset / Current obligation 2012 (RM000) 2011 (RM000) 9,185,620 / 2,202,499= 4. 7 7,703,105 / 2,288,028= 3. 36 The group ratio increased in year 2012 2. Total debt to center asset = (short term debt + long term debt) / total asset 2012 (RM000) 2011 (RM000) 10,148,965 / 23,064,868= 0. 44 7,393,721 / 19,655,119= 0. 37 Total funds that areprovided by creditors is increasing in year2012 3. Total asset turnover = Sales / total asset 2012 (RM000) 2011 (RM000) 15,640,272 / 23,064,868= 0. 67 16,154,251 / 19,655,119= 0. 82 4. Profitability = net income / sales 2012 (RM000) 2011 (RM000) ,828,529 / 15,640,272= 0. 11 2,290,513 / 16,154,251= 0. 14 After tax networks decreased per ringgit of sales 5. Market value * EPS = 0. 2785 * P/E = 18. 2047 * Price per share = 5. 07 * (Current assets circulating(prenominal) liabilities) / ordinary shares = (9,185,620 2,202,499) / 6,419,174 = 1. 08 * Fair value = (5. 07 / 2) + (1. 08 / 2) = 2. 535 + 0. 54 = 3. 075 IOI group s profit is decreased on year 2012. The market fair value is lots lower than the actual price per share. The option is to sell the share sooner of buying it.