SlideShare a Scribd company logo

Account assignment fnbe

SDSDSD

1 of 22
Download to read offline
SCHOOL OF ARCHITECTURE, BUILDING AND DESIGN
FOUNDATION IN NATURAL AND BUILT ENVIRONMENT
Basic Accounting (ACC30205)
Assignment: Financial Ratio Analysis
Company Name : LBS Bina
Lecturer: Ms. Tay Shir Men
Group Members: Calvin Wong Kim Ming (0323642)
Chiang Lin Chew (0322923)
Ti Cheng Jie (0323931)
Zachary Ooi Cheng En (0323120)
Table of Content
NO. CONTENT PAGE NO.
1. History of LBS Group Berhad 1
2. Recent Development 2-3
3. Profitability Ratio 4-5
4. Stability Ratio 6-7
5. Price Earning Ratio 8-10
6. Investment Recommendation 11-12
7. Appendix 13-19
8. References 20
Brief Background History of LBS
LBS Bina Group Berhad is a prominent property developer in Malaysia. Having been
around for more than 20 years, LBS Bina has built a strong reputation for developing
high quality properties all over Malaysia and abroad.
The history behind LBS Bina actually dates back longer than that when Datuk Lim
Bock Seng started a construction business in Petaling Jaya which would later grow to
become one of the most significant property developers in Malaysia.
LBS would then expand further in 1992 when it ventured into the property
development sector through the Jelapang Maju Light Industrial Park in Perak. That
would be the springboard to more projects as LBS continued to grow exponentially.
Before long, the company was undertaking several large projects including its
flagship projects like the Taman Perindustrian Bukit Serdang Seksyen 14, Taman
Pinggiran Putra and the very popular Bandar Saujana Putra, which was a mega
project.
Since then, LBS has continued to expand and grow where it is among the primary
players in the Malaysian market while it is expanding further outside the country into
China, seen as one of the most challenging markets in the world. Today, LBS is
involved not only in property development but in several other related areas like
property management, building materials and landscaping, among others.
Among other projects that LBS has been involved in include the very popular The
Lake Residences in Puchong, D’Island Residences, Indigo Homes, Pearl Villa, Topaz
III and IV, the Ivory Residences II, Magenta Homes and I Hub Puchong.
Recent Development
PROPERTY developer LBS Bina Group Bhd (LBS) will be showcasing its popular
developments at the Stylish Living Property Fair by StarProperty.my which will be
held from today till Sunday in the Kuala Lumpur Convention Centre.
“In line with this year’s theme, LBS aims to make stylish living accessible to different
property segments, whether it is affordable, medium or high-end.
“In addition to the attractive incentives, rebates and discounts available, our
developments are expected to meet the demands of homebuyers and investors alike,”
said LBS managing director Datuk Lim Hock San.
Buyers can expect to view five LBS developments — BSP Skypark (Bandar Saujana
Putra), Barrington Square (Cameron Golden Hills), Balvia, Nautilus as well as D’
Island Residence.
Catering to young families and first-time homebuyers, BSP Skypark boasts 689
serviced residence units alongside 32 commercial units. Priced from RM400,900,
with a gross built-up area from 1,004 sq ft, the serviced residences feature a three-
bedroom, two-bathroom layout. The commercial units come with gross built up area
from 1,030 sq ft and are priced from RM618,000.
Another in demand development by LBS is Barrington Square located in Cameron
Golden Hills, Cameron Highlands. Similar to BSP Skypark, LBS incorporates the
element of convenience in Barrington Square’s shop apartments.
Each apartment unit boasts a built-up area from 581 sq ft to 1,345 sq ft while the shop
units have a built-up area from 1,001 sq ft. Buyers have an option of three apartment
styles to choose from namely a studio unit priced from RM301,800, two-room
apartment from RM356,800 and penthouses with two to three rooms from
RM487,800. Shops units on the lower ground floor are priced from RM750,800.
Delivering more options in the high-end market segment, LBS will also be featuring
its flagship development, namely Balvia, Nautilus and D’ Island Residence. Inspired
by Thai elements, Balvia homes offer a larger layout option with a gross built-up area
of 4,864 sq ft and land size of 40’x80’.
The three-storey semi-detached houses come with a luxurious five bedrooms with six
bathrooms plus two utility rooms. Priced from RM2.5mil, Balvia units come with a
range of value added features which include a lift, rainwater harvesting system and
alarm as well as intercom system.
Phase one of Balvia is expected to be completed by November 2013.
Located on the Scandinavian-inspired coast of D’ Island Residence, Nautilus offers a
selection of two layout types, such as 24’ x 100’ (Type A) and 24’ x 80’ (Type B)
which have a gross built-up area from 4,791 sq ft and 4,246 sq ft, respectively.
The three-storey superlink home offers an exquisite five bedroom, one utility and six
bathroom layout and is priced from RM1.9mil for Type A and RM1.8mil for Type B.
Nautilus’ unique features include solar panels, a lift, rain water harvesting system, hot
water piping and alarm as well as intercom system.
Phase one of Nautilus is expected to be completed by the second quarter of 2014.
Buyers who want the freedom to design their dream homes can explore the benefits of
D’ Island Residences’ bungalow lands. Located on the north and north-west coast of
D’ Island Residence, the vacant land area ranges from 6,566 sq ft to 11,452 sq ft
priced from RM260 to RM300 per sq ft.
A RM50,000 moving-in incentive awaits buyers who successfully complete the
construction of bungalows within five years from the vacant possession date. Phase
one of the bungalow land is expected to be ready by November 2013.
Profitability Ratio
The following table shows profitability ratio calculation and
interpretation for LBS Bina in the year 2012 and 2013.
Profitability
Ratio
2012 2013 Interpretation
Return on
Equity (ROE)
509,644,355
516,690,656.5
X100%
=98.6%
533,532,722
699,735,858
X100%
=76.2%
HigherROE inthe
year2012 compared
to 2013 showsthat
the business,LBS
Binais earning
higherreturnsof
capital in2012.
Net Profit
Margin (NPM)
39,003,430
509,644,355
X100%
=9.4%
397,323,654
533,532,722
X100%
=74.5%
An increase inNPM
for the year2013 is
a positive signandit
indicatesthatLBS
Binakeptits
expenseslower
comparedto the
year2012. Thus,this
givesthe business
more profitfor
2013. Furthermore,
thisshowsthat LBS
Binacontrolledtheir
overall expenses
betterin2013
Gross Profit
Margin (GPM)
146,227,906
509,644,355
X100%
=28.1%
168,577,154
533,532,722
X100%
=31.6%
ThismeasuresLBS
Bina’sabilityto
control theirCOGS
expense.A higher
GPM meansthatthe
expense is better
managed.The COGS
expensesare well
managedin2013
resultinginahigher
GPM.
General Exp.
Ratio (GER)
67,470,147
509,644,355
X100%
=13.2%
85,596,945
533,532,722
X100%
=16.0%
The year 2013
showsthat the GER
ishighercompared
to 2012. A higher
general expense
wouldresultina
lowerNPM.

Recommended

Account Assignment report Fnbe
Account Assignment report FnbeAccount Assignment report Fnbe
Account Assignment report FnbeCarol Tang
 
369c3c8f92959241d425bbf61e61a33c(1)
369c3c8f92959241d425bbf61e61a33c(1)369c3c8f92959241d425bbf61e61a33c(1)
369c3c8f92959241d425bbf61e61a33c(1)Klaus Chiang
 
Project presentation 1
Project presentation 1Project presentation 1
Project presentation 1Klaus Chiang
 
Project 1 brief cts mac 2015(1)
Project 1 brief cts mac 2015(1)Project 1 brief cts mac 2015(1)
Project 1 brief cts mac 2015(1)Klaus Chiang
 
Oursite 150816183922-lva1-app6892
Oursite 150816183922-lva1-app6892Oursite 150816183922-lva1-app6892
Oursite 150816183922-lva1-app6892Klaus Chiang
 

More Related Content

Viewers also liked

Fnbe september 2015 assignment 1
Fnbe september 2015 assignment 1Fnbe september 2015 assignment 1
Fnbe september 2015 assignment 1Klaus Chiang
 
Psychology slides-2
Psychology slides-2Psychology slides-2
Psychology slides-2Klaus Chiang
 
Weixuan_Tang_Resume
Weixuan_Tang_Resume Weixuan_Tang_Resume
Weixuan_Tang_Resume Weixuan Tang
 
C44f583e8c8d49efe13e2dba0ed541b4
C44f583e8c8d49efe13e2dba0ed541b4C44f583e8c8d49efe13e2dba0ed541b4
C44f583e8c8d49efe13e2dba0ed541b4Klaus Chiang
 
English report-essay
English report-essayEnglish report-essay
English report-essayKlaus Chiang
 
Fnbe planner final
Fnbe planner finalFnbe planner final
Fnbe planner finalKlaus Chiang
 

Viewers also liked (8)

Fnbe september 2015 assignment 1
Fnbe september 2015 assignment 1Fnbe september 2015 assignment 1
Fnbe september 2015 assignment 1
 
Englishklaus
EnglishklausEnglishklaus
Englishklaus
 
Psychology slides-2
Psychology slides-2Psychology slides-2
Psychology slides-2
 
Weixuan_Tang_Resume
Weixuan_Tang_Resume Weixuan_Tang_Resume
Weixuan_Tang_Resume
 
Psychology
PsychologyPsychology
Psychology
 
C44f583e8c8d49efe13e2dba0ed541b4
C44f583e8c8d49efe13e2dba0ed541b4C44f583e8c8d49efe13e2dba0ed541b4
C44f583e8c8d49efe13e2dba0ed541b4
 
English report-essay
English report-essayEnglish report-essay
English report-essay
 
Fnbe planner final
Fnbe planner finalFnbe planner final
Fnbe planner final
 

Similar to Account assignment fnbe

Revised version accounting assignment
Revised version accounting assignmentRevised version accounting assignment
Revised version accounting assignmentAlwin Ng
 
Basic Accounting Assignment 1 Report
Basic Accounting Assignment 1 Report Basic Accounting Assignment 1 Report
Basic Accounting Assignment 1 Report kellyxc
 
Accounts Assignment
Accounts AssignmentAccounts Assignment
Accounts AssignmentYip Xiaojung
 
Account assignment report finale
Account assignment report finaleAccount assignment report finale
Account assignment report finalelohwenjun
 
Acc report
Acc reportAcc report
Acc reportLi Jing
 
Account assignment report finale(1)
Account assignment report finale(1)Account assignment report finale(1)
Account assignment report finale(1)Chong Yi Hui
 
Accounting final project 2
Accounting final project 2Accounting final project 2
Accounting final project 2AdeleLu
 
Accounting final project - financial ration analysis
Accounting final project - financial ration analysisAccounting final project - financial ration analysis
Accounting final project - financial ration analysisSheng Zhe
 
Accounting project 2
Accounting  project 2Accounting  project 2
Accounting project 2Kenneth Tan
 
Accounting Report
Accounting ReportAccounting Report
Accounting Reportashleyyeap
 
Accounting final project 2
Accounting final project 2Accounting final project 2
Accounting final project 2Kenneth Tan
 
Accounting final project 2
Accounting final project 2 Accounting final project 2
Accounting final project 2 gjj97
 
FINANCIAL RATIO ANALYSIS
FINANCIAL RATIO ANALYSISFINANCIAL RATIO ANALYSIS
FINANCIAL RATIO ANALYSISArissa Loh
 
Fm assignment-final-updated v2.0
Fm assignment-final-updated v2.0Fm assignment-final-updated v2.0
Fm assignment-final-updated v2.0Arthur Wilson
 
Construction Supply Chain Management (Individual Assignment) - Semester 3
Construction Supply Chain Management (Individual Assignment) - Semester 3Construction Supply Chain Management (Individual Assignment) - Semester 3
Construction Supply Chain Management (Individual Assignment) - Semester 3Yee Len Wan
 
Real estate business plan example
Real estate business plan exampleReal estate business plan example
Real estate business plan exampleupmetrics.co
 
Luxury Property Segment Brief
Luxury Property Segment BriefLuxury Property Segment Brief
Luxury Property Segment Briefdamdimdum
 

Similar to Account assignment fnbe (20)

Revised version accounting assignment
Revised version accounting assignmentRevised version accounting assignment
Revised version accounting assignment
 
Basic Accounting Assignment 1 Report
Basic Accounting Assignment 1 Report Basic Accounting Assignment 1 Report
Basic Accounting Assignment 1 Report
 
Accounts Assignment
Accounts AssignmentAccounts Assignment
Accounts Assignment
 
Account assignment report finale
Account assignment report finaleAccount assignment report finale
Account assignment report finale
 
Acc report
Acc reportAcc report
Acc report
 
Acc report
Acc reportAcc report
Acc report
 
Account assignment report finale(1)
Account assignment report finale(1)Account assignment report finale(1)
Account assignment report finale(1)
 
Accounting final project 2
Accounting final project 2Accounting final project 2
Accounting final project 2
 
Accounting final project - financial ration analysis
Accounting final project - financial ration analysisAccounting final project - financial ration analysis
Accounting final project - financial ration analysis
 
Accounting project 2
Accounting  project 2Accounting  project 2
Accounting project 2
 
Accounting Report
Accounting ReportAccounting Report
Accounting Report
 
Accounting final project 2
Accounting final project 2Accounting final project 2
Accounting final project 2
 
Accounting final project 2
Accounting final project 2 Accounting final project 2
Accounting final project 2
 
FINANCIAL RATIO ANALYSIS
FINANCIAL RATIO ANALYSISFINANCIAL RATIO ANALYSIS
FINANCIAL RATIO ANALYSIS
 
Fna account-2
Fna account-2Fna account-2
Fna account-2
 
Fna account
Fna accountFna account
Fna account
 
Fm assignment-final-updated v2.0
Fm assignment-final-updated v2.0Fm assignment-final-updated v2.0
Fm assignment-final-updated v2.0
 
Construction Supply Chain Management (Individual Assignment) - Semester 3
Construction Supply Chain Management (Individual Assignment) - Semester 3Construction Supply Chain Management (Individual Assignment) - Semester 3
Construction Supply Chain Management (Individual Assignment) - Semester 3
 
Real estate business plan example
Real estate business plan exampleReal estate business plan example
Real estate business plan example
 
Luxury Property Segment Brief
Luxury Property Segment BriefLuxury Property Segment Brief
Luxury Property Segment Brief
 

More from Klaus Chiang

Psychology slides (2)
Psychology slides (2)Psychology slides (2)
Psychology slides (2)Klaus Chiang
 
Psychologyindividual
PsychologyindividualPsychologyindividual
PsychologyindividualKlaus Chiang
 
Oral presentation individual (september 2015)
Oral presentation   individual (september 2015)Oral presentation   individual (september 2015)
Oral presentation individual (september 2015)Klaus Chiang
 
E portfolio assignment september 2015
E portfolio assignment september 2015E portfolio assignment september 2015
E portfolio assignment september 2015Klaus Chiang
 
Itd final project tutorial
Itd final project tutorial Itd final project tutorial
Itd final project tutorial Klaus Chiang
 
369c3c8f92959241d425bbf61e61a33c
369c3c8f92959241d425bbf61e61a33c369c3c8f92959241d425bbf61e61a33c
369c3c8f92959241d425bbf61e61a33cKlaus Chiang
 
853d2d6cb078f2bc22f052891402e306
853d2d6cb078f2bc22f052891402e306853d2d6cb078f2bc22f052891402e306
853d2d6cb078f2bc22f052891402e306Klaus Chiang
 
Project1integrationmarch20152 150816165139-lva1-app6891
Project1integrationmarch20152 150816165139-lva1-app6891Project1integrationmarch20152 150816165139-lva1-app6891
Project1integrationmarch20152 150816165139-lva1-app6891Klaus Chiang
 
Iciassignemnt2projectbrief 150816165231-lva1-app6891
Iciassignemnt2projectbrief 150816165231-lva1-app6891Iciassignemnt2projectbrief 150816165231-lva1-app6891
Iciassignemnt2projectbrief 150816165231-lva1-app6891Klaus Chiang
 
April 2015 assignment 2
April 2015 assignment 2April 2015 assignment 2
April 2015 assignment 2Klaus Chiang
 
Interiorarchitecture 150816131601-lva1-app6891
Interiorarchitecture 150816131601-lva1-app6891Interiorarchitecture 150816131601-lva1-app6891
Interiorarchitecture 150816131601-lva1-app6891Klaus Chiang
 

More from Klaus Chiang (16)

Psychology slides (2)
Psychology slides (2)Psychology slides (2)
Psychology slides (2)
 
Psychologyindividual
PsychologyindividualPsychologyindividual
Psychologyindividual
 
Oral presentation individual (september 2015)
Oral presentation   individual (september 2015)Oral presentation   individual (september 2015)
Oral presentation individual (september 2015)
 
E portfolio assignment september 2015
E portfolio assignment september 2015E portfolio assignment september 2015
E portfolio assignment september 2015
 
English slides
English slidesEnglish slides
English slides
 
Itd final project tutorial
Itd final project tutorial Itd final project tutorial
Itd final project tutorial
 
Project 2 itd
Project 2 itdProject 2 itd
Project 2 itd
 
369c3c8f92959241d425bbf61e61a33c
369c3c8f92959241d425bbf61e61a33c369c3c8f92959241d425bbf61e61a33c
369c3c8f92959241d425bbf61e61a33c
 
853d2d6cb078f2bc22f052891402e306
853d2d6cb078f2bc22f052891402e306853d2d6cb078f2bc22f052891402e306
853d2d6cb078f2bc22f052891402e306
 
Ici individual
Ici individualIci individual
Ici individual
 
Cts process
Cts processCts process
Cts process
 
Ici individual
Ici individualIci individual
Ici individual
 
Project1integrationmarch20152 150816165139-lva1-app6891
Project1integrationmarch20152 150816165139-lva1-app6891Project1integrationmarch20152 150816165139-lva1-app6891
Project1integrationmarch20152 150816165139-lva1-app6891
 
Iciassignemnt2projectbrief 150816165231-lva1-app6891
Iciassignemnt2projectbrief 150816165231-lva1-app6891Iciassignemnt2projectbrief 150816165231-lva1-app6891
Iciassignemnt2projectbrief 150816165231-lva1-app6891
 
April 2015 assignment 2
April 2015 assignment 2April 2015 assignment 2
April 2015 assignment 2
 
Interiorarchitecture 150816131601-lva1-app6891
Interiorarchitecture 150816131601-lva1-app6891Interiorarchitecture 150816131601-lva1-app6891
Interiorarchitecture 150816131601-lva1-app6891
 

Recently uploaded

WEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINES
WEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINESWEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINES
WEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINESMariaeGladysAfrica
 
Kevin Dixon Personal Brand Exploration.pdf
Kevin Dixon Personal Brand Exploration.pdfKevin Dixon Personal Brand Exploration.pdf
Kevin Dixon Personal Brand Exploration.pdfKevin Dixon
 
6 Sex Moves for When It's Freezing Outside Humor in Comics
6 Sex Moves for When It's Freezing Outside Humor in Comics6 Sex Moves for When It's Freezing Outside Humor in Comics
6 Sex Moves for When It's Freezing Outside Humor in ComicsSalty Vixen Stories & More
 
Dont_Think_Prospectus_FINAL_Project_.pptx
Dont_Think_Prospectus_FINAL_Project_.pptxDont_Think_Prospectus_FINAL_Project_.pptx
Dont_Think_Prospectus_FINAL_Project_.pptxHayleyDerby
 
Conventions of a Sci-fi Horror Pilot Research
Conventions of a Sci-fi Horror Pilot ResearchConventions of a Sci-fi Horror Pilot Research
Conventions of a Sci-fi Horror Pilot Research17mdav134
 
Unlocking the Thrill: The World of Escape Rooms
Unlocking the Thrill: The World of Escape RoomsUnlocking the Thrill: The World of Escape Rooms
Unlocking the Thrill: The World of Escape RoomsJoycea Morton
 
Easter Egg Convergence Research Powerpoint
Easter Egg Convergence Research PowerpointEaster Egg Convergence Research Powerpoint
Easter Egg Convergence Research Powerpoint17mdav134
 
Kingdom Hearts: A series summary and "quick" guide
Kingdom Hearts: A series summary and "quick" guideKingdom Hearts: A series summary and "quick" guide
Kingdom Hearts: A series summary and "quick" guidejiminyjournal0
 
Birthday Party Entertainment for Kids.pptx
Birthday Party Entertainment for Kids.pptxBirthday Party Entertainment for Kids.pptx
Birthday Party Entertainment for Kids.pptxOoopsy Entertainment
 
The Walking Dead Content and Conventions
The Walking Dead Content and ConventionsThe Walking Dead Content and Conventions
The Walking Dead Content and Conventions17mdav134
 
The Music Industry by Wesley Conner (V1N0)
The Music Industry by Wesley Conner (V1N0)The Music Industry by Wesley Conner (V1N0)
The Music Industry by Wesley Conner (V1N0)tarantinovinoofficia
 
American Horror Story Episode Analysis -
American Horror Story  Episode Analysis -American Horror Story  Episode Analysis -
American Horror Story Episode Analysis -17mdav134
 

Recently uploaded (14)

WEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINES
WEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINESWEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINES
WEEK 3 ISSUES MORAL SOCIAL AND ECONOMICAL ISSUES IN THE PHILIPPINES
 
Kevin Dixon Personal Brand Exploration.pdf
Kevin Dixon Personal Brand Exploration.pdfKevin Dixon Personal Brand Exploration.pdf
Kevin Dixon Personal Brand Exploration.pdf
 
6 Sex Moves for When It's Freezing Outside Humor in Comics
6 Sex Moves for When It's Freezing Outside Humor in Comics6 Sex Moves for When It's Freezing Outside Humor in Comics
6 Sex Moves for When It's Freezing Outside Humor in Comics
 
An interview with the director of "Zone of Interest"
An interview with the director of "Zone of Interest"An interview with the director of "Zone of Interest"
An interview with the director of "Zone of Interest"
 
"Schindler’s List" : an oral history with the actors
"Schindler’s List" : an oral history with the actors"Schindler’s List" : an oral history with the actors
"Schindler’s List" : an oral history with the actors
 
Dont_Think_Prospectus_FINAL_Project_.pptx
Dont_Think_Prospectus_FINAL_Project_.pptxDont_Think_Prospectus_FINAL_Project_.pptx
Dont_Think_Prospectus_FINAL_Project_.pptx
 
Conventions of a Sci-fi Horror Pilot Research
Conventions of a Sci-fi Horror Pilot ResearchConventions of a Sci-fi Horror Pilot Research
Conventions of a Sci-fi Horror Pilot Research
 
Unlocking the Thrill: The World of Escape Rooms
Unlocking the Thrill: The World of Escape RoomsUnlocking the Thrill: The World of Escape Rooms
Unlocking the Thrill: The World of Escape Rooms
 
Easter Egg Convergence Research Powerpoint
Easter Egg Convergence Research PowerpointEaster Egg Convergence Research Powerpoint
Easter Egg Convergence Research Powerpoint
 
Kingdom Hearts: A series summary and "quick" guide
Kingdom Hearts: A series summary and "quick" guideKingdom Hearts: A series summary and "quick" guide
Kingdom Hearts: A series summary and "quick" guide
 
Birthday Party Entertainment for Kids.pptx
Birthday Party Entertainment for Kids.pptxBirthday Party Entertainment for Kids.pptx
Birthday Party Entertainment for Kids.pptx
 
The Walking Dead Content and Conventions
The Walking Dead Content and ConventionsThe Walking Dead Content and Conventions
The Walking Dead Content and Conventions
 
The Music Industry by Wesley Conner (V1N0)
The Music Industry by Wesley Conner (V1N0)The Music Industry by Wesley Conner (V1N0)
The Music Industry by Wesley Conner (V1N0)
 
American Horror Story Episode Analysis -
American Horror Story  Episode Analysis -American Horror Story  Episode Analysis -
American Horror Story Episode Analysis -
 

Account assignment fnbe

  • 1. SCHOOL OF ARCHITECTURE, BUILDING AND DESIGN FOUNDATION IN NATURAL AND BUILT ENVIRONMENT Basic Accounting (ACC30205) Assignment: Financial Ratio Analysis Company Name : LBS Bina Lecturer: Ms. Tay Shir Men Group Members: Calvin Wong Kim Ming (0323642) Chiang Lin Chew (0322923) Ti Cheng Jie (0323931) Zachary Ooi Cheng En (0323120)
  • 2. Table of Content NO. CONTENT PAGE NO. 1. History of LBS Group Berhad 1 2. Recent Development 2-3 3. Profitability Ratio 4-5 4. Stability Ratio 6-7 5. Price Earning Ratio 8-10 6. Investment Recommendation 11-12 7. Appendix 13-19 8. References 20
  • 3. Brief Background History of LBS LBS Bina Group Berhad is a prominent property developer in Malaysia. Having been around for more than 20 years, LBS Bina has built a strong reputation for developing high quality properties all over Malaysia and abroad. The history behind LBS Bina actually dates back longer than that when Datuk Lim Bock Seng started a construction business in Petaling Jaya which would later grow to become one of the most significant property developers in Malaysia. LBS would then expand further in 1992 when it ventured into the property development sector through the Jelapang Maju Light Industrial Park in Perak. That would be the springboard to more projects as LBS continued to grow exponentially. Before long, the company was undertaking several large projects including its flagship projects like the Taman Perindustrian Bukit Serdang Seksyen 14, Taman Pinggiran Putra and the very popular Bandar Saujana Putra, which was a mega project. Since then, LBS has continued to expand and grow where it is among the primary players in the Malaysian market while it is expanding further outside the country into China, seen as one of the most challenging markets in the world. Today, LBS is involved not only in property development but in several other related areas like property management, building materials and landscaping, among others. Among other projects that LBS has been involved in include the very popular The Lake Residences in Puchong, D’Island Residences, Indigo Homes, Pearl Villa, Topaz III and IV, the Ivory Residences II, Magenta Homes and I Hub Puchong.
  • 4. Recent Development PROPERTY developer LBS Bina Group Bhd (LBS) will be showcasing its popular developments at the Stylish Living Property Fair by StarProperty.my which will be held from today till Sunday in the Kuala Lumpur Convention Centre. “In line with this year’s theme, LBS aims to make stylish living accessible to different property segments, whether it is affordable, medium or high-end. “In addition to the attractive incentives, rebates and discounts available, our developments are expected to meet the demands of homebuyers and investors alike,” said LBS managing director Datuk Lim Hock San. Buyers can expect to view five LBS developments — BSP Skypark (Bandar Saujana Putra), Barrington Square (Cameron Golden Hills), Balvia, Nautilus as well as D’ Island Residence. Catering to young families and first-time homebuyers, BSP Skypark boasts 689 serviced residence units alongside 32 commercial units. Priced from RM400,900, with a gross built-up area from 1,004 sq ft, the serviced residences feature a three- bedroom, two-bathroom layout. The commercial units come with gross built up area from 1,030 sq ft and are priced from RM618,000. Another in demand development by LBS is Barrington Square located in Cameron Golden Hills, Cameron Highlands. Similar to BSP Skypark, LBS incorporates the element of convenience in Barrington Square’s shop apartments. Each apartment unit boasts a built-up area from 581 sq ft to 1,345 sq ft while the shop units have a built-up area from 1,001 sq ft. Buyers have an option of three apartment styles to choose from namely a studio unit priced from RM301,800, two-room apartment from RM356,800 and penthouses with two to three rooms from RM487,800. Shops units on the lower ground floor are priced from RM750,800. Delivering more options in the high-end market segment, LBS will also be featuring its flagship development, namely Balvia, Nautilus and D’ Island Residence. Inspired by Thai elements, Balvia homes offer a larger layout option with a gross built-up area of 4,864 sq ft and land size of 40’x80’. The three-storey semi-detached houses come with a luxurious five bedrooms with six bathrooms plus two utility rooms. Priced from RM2.5mil, Balvia units come with a range of value added features which include a lift, rainwater harvesting system and alarm as well as intercom system. Phase one of Balvia is expected to be completed by November 2013. Located on the Scandinavian-inspired coast of D’ Island Residence, Nautilus offers a selection of two layout types, such as 24’ x 100’ (Type A) and 24’ x 80’ (Type B) which have a gross built-up area from 4,791 sq ft and 4,246 sq ft, respectively.
  • 5. The three-storey superlink home offers an exquisite five bedroom, one utility and six bathroom layout and is priced from RM1.9mil for Type A and RM1.8mil for Type B. Nautilus’ unique features include solar panels, a lift, rain water harvesting system, hot water piping and alarm as well as intercom system. Phase one of Nautilus is expected to be completed by the second quarter of 2014. Buyers who want the freedom to design their dream homes can explore the benefits of D’ Island Residences’ bungalow lands. Located on the north and north-west coast of D’ Island Residence, the vacant land area ranges from 6,566 sq ft to 11,452 sq ft priced from RM260 to RM300 per sq ft. A RM50,000 moving-in incentive awaits buyers who successfully complete the construction of bungalows within five years from the vacant possession date. Phase one of the bungalow land is expected to be ready by November 2013.
  • 6. Profitability Ratio The following table shows profitability ratio calculation and interpretation for LBS Bina in the year 2012 and 2013. Profitability Ratio 2012 2013 Interpretation Return on Equity (ROE) 509,644,355 516,690,656.5 X100% =98.6% 533,532,722 699,735,858 X100% =76.2% HigherROE inthe year2012 compared to 2013 showsthat the business,LBS Binais earning higherreturnsof capital in2012. Net Profit Margin (NPM) 39,003,430 509,644,355 X100% =9.4% 397,323,654 533,532,722 X100% =74.5% An increase inNPM for the year2013 is a positive signandit indicatesthatLBS Binakeptits expenseslower comparedto the year2012. Thus,this givesthe business more profitfor 2013. Furthermore, thisshowsthat LBS Binacontrolledtheir overall expenses betterin2013 Gross Profit Margin (GPM) 146,227,906 509,644,355 X100% =28.1% 168,577,154 533,532,722 X100% =31.6% ThismeasuresLBS Bina’sabilityto control theirCOGS expense.A higher GPM meansthatthe expense is better managed.The COGS expensesare well managedin2013 resultinginahigher GPM. General Exp. Ratio (GER) 67,470,147 509,644,355 X100% =13.2% 85,596,945 533,532,722 X100% =16.0% The year 2013 showsthat the GER ishighercompared to 2012. A higher general expense wouldresultina lowerNPM.
  • 7. Financial Exp. Ratio (FER) 18,457,247 509,644,355 X100% =3.6% 15,170,850 533,532,722 X100% =2.8% FER in the year2013 islowerthan2012. Thisindicatesthat the financial expense in2013 is lesserthan2012. As such,thisleadsto a higherNPMin 2013 because the financial expenseis lower.
  • 8. Financial Stability Ratio The following table shows the profitability ratio calculation and interpretation for LBS Bina in the year 2013 and 2013. Stability Ratio 2012 2013 Interpretatio n Working Capital (WCR) 927,829,389 520,720,661 =0.62:1 925,492,766 609,599,483 =1.52:1 For everyRM1 of current liabilityinthe year2013, the business,LBS Binahas 1.52 of currentassets to pay forit. It has a higher ratiothan 2012. However,a businessshould preferablyhave a minimumof 2:1 of current assetsto currentliability to ensure that the business doesnotface difficulties. Total Debt (TDR) 908,176,834 1,435,008,317 X100% =63.6% 1,137,172,437 2,009,812,670 X100% =56.6% For 2013, the TDR is lower than 2012, havinga TDR of 63.6% and 56.6% respectively.As the TDR islower than in2013, thisresultsina higheramount of owner’s equity.Itis stronglyadvised that a business’ TDR doesnot exceedmore than 50% as it wouldhave a higherriskof bankruptcy.
  • 9. Inventory Turnover Ratio (ITR) 365days ÷ 363,416,449 15,721,777.5 =16 days 365 days ÷ 364,955,568 7,934,313 =8 days It takes8 days for the business in2013 to sell one batch of goods.The businessin2013 can sell goods rapidly, generating more cash quicklytopay off itsliabilities. Interest Coverage Ratio (ICR) 18,457,247 + 75,014,260 18,457,247 =5.1 times 426,901,921 + 15,170,850 15,170,850 =29.1 times LBS Bina’sICR is higherin2013 than in2012. Thismeansthat the business’ abilitytopayoff itsinterest expense in higherthan 2012. Inthe year2013, LBS Binahas enough profitto payits interest expenses29.1 times.Toavoid bankruptcy,a business’ interest coverage should not fall below 5 times.
  • 10. Price Earning Ratio (P/E Ratio) 2012 Basic earnings per share: 9.7 Current share price: 0.84 (0.84/9.70)= 8.148 2013 Basic earnings per share: 96.09 Current share price: 1.56 (1.56/96.09)= 0.016 The P/E ratio measures how expensive a share is. In the year 2012, the P/E ratio is 8.148 while in the year 2013 the P/E ratio is 0.016. This means that the share in 2013 is less expensive compared to the share in the year 2012. A P/E ratio of 0.016 indicates that an investor will need to wait for 0.016 years to recoup his investment.
  • 11. LBS Bina Group Bhd (5789.KL) FTSE Bursa Malaysia KLCI (^KLSE) Based on the graph above, it shows that the share price for LBS Bina Group Bhd and index for FTSE Bursa Malaysia KLCI. Before determining whether to invest in either in a company or a overall market share KLCI, which company has a better percentage over the time period from May 2015 to February 2016 must be understood. Hence, 3 different points of the time will be viewed ti determined the performance of both the graph. First point of the time, the share price of LBS Bina Group Bhd is 1.74 on 7 May 2014, and the index for FTSE Bursa Malaysia KLCI is 1805.10. At 17 July 2015, the share price decrease to 1.69 and the index decrease to 1574.67. The decrease of the share price is (1.69-1.74)/1.74 = -2.87% whereas the index changes is (1574.67–1805.10)/ 1805.10 = -12.7%. This is to say that the performance of the company is better than the index.
  • 12. The share price of LBS Bina Group Bhd is 1.7200 on 20 August 2014, and the index for FTSEBursa Malaysia KLCI is 1577.41. At 21 November 2014, the share price decrease to 1.7000 and the index increase to 1661.89. The decrease of share price is (1.7000-1.7200)/ 1.7200= -1.16%, whereas the index changes is (1.661.89- 1577.41)/1661.89= 5.08%. As such, the performance of the company is worse than the index this time. For the final of the graph, on 8 July 2015 which the share price is 1.5200 for LBS Bina Group Bhd and the index for FTSEBursa Malaysia KLCI is 1695.83. At 7 August 2015, the share price decrease to 1.4600 and the index price also decrease to 1682.65. The decrease of share price is (1.4600 – 1.5200)/1.5200= -3.94%, whereas the index changes is (1682.65 – 1695.83)/1695.83= - 0.78%. Hence, the performance of the company is worse than the index this time. By comparing LBS Bina Group Bhd with the overall market share KLCI, LBS Bina is continuously dropping, while FTSEBursa Malaysia is also decreasing although there are times where is raised but not as bad as LBS Group. Furthermore, the 3 point of time that has been calculated shows that LBS Group Bhd is not recommended for investing in.
  • 13. Investment Recommendation ● Transforming into a significant medium to high-end developer. LBS Bina Group Berhad (LBS) has long been recognised as a low-to-medium cost developer. The Group has recently rebranded its corporate image and reposition itself to become one of the significant medium-to-high end property players after realising that its previous business model failed to withstand the financial crisis in 2008. We believe the stock will be back into investors' radar screen once it posts more convincing earnings this year and its successful launches of high-profile project, D'Island, in Klang Valley. ● Strong turnaround. LBS has successfully returned to the black in 2010 by achieving RM16.5m net profit against losses of RM17.2m posted in 2009 thanks to strong sales and higher margin achieved from its medium-to-high end projects. Going forward, we estimate the Group to record net profit of RM40.1m in 2011F, a whopping jump of 142.6% yoy and maintaining its profit momentum for 2012F and 2013F with net profit of RM83.4m and RM119.7m respectively. ● RM9.1b sizeable GDV to sustain the Group's earnings over the next 10-15 years. LBS has a total undeveloped land bank of 2,400 acres in Klang Valley, Cameron Highlands, Perak, Johor and China yielding total GDV of RM9.1b (ex-China). The Group targets to launch its flagship high-end project, D'Island, in Puchong in September 2011. The response for the pre-sales is encouraging with 90% take-up for the 122 units of 3-storey superlink houses being launched, pricing over a million or RM370-400psf. ● Strong unbilled sales. The Group has successfully chalked in about RM591m unbilled sales which provides earnings visibility of almost 1.7x of the Group's 2010 revenue of RM341m. Going forward, LBS is expected to continue to achieve impressive new sales with its strategy of focusing middle to high income level house buyers, which is less prone to rising cost of living.
  • 14. Attractive valuation with potential 165% upside. Our non-rated target price for LBS is RM2.03, which is based on 50% discount to its RNAV/share of RM4.07 in view of LBS being a small cap stock. Our target price also implies 9.4x 2012F and 6.5x 2012F PER. Current valuations look attractive as it is trading at 7.4x 2011F and 3.6x 2012F PER, which is significantly lower than the sector average of 13-14x.