BBPPW3103

BIM

KE-3 / MEI 2014

BBPB2103 HUMAN REACRCH

<TAJUK KURSUS>

NO. MATRIKULASI

NO. KAD PENGNEALAN

<NO MATRIKULASI>
:

730928-12-5674

NO. TELEFON

01058580018

E-MEL

anisahjatin@yahoo.com

PUSAT PEMBELAJARAN

OUM SABAH

BBPPW3103

Contents
TITLE: FINANCIAL RATIO ANALYSIS ON TWO COMPANIES.......................................0
2.1 IJM CORPORATION BACKGROUND.........................................................................3
2.2. IGB CORPORATION BACKGROUND........................................................................5
6.1.0 PROFITABILITY RATIO................................................................................................9
6.2.0 LIQUIDITYS RATIO................................................................................................11
6.2.1 Net working capital.....................................................................................................11
6.2.2 Current ratio.................................................................................................................13
6.2.3 QUICK RATIO............................................................................................................15
6.3.0 Activity/Efficiency Ratio.............................................................................................16
6.4.0 LEVERAGE / GEARING RATIO..............................................................................19
6.5.0 MARKET VALUE...................................................................................................21
7.0 The Overview of Company Performance up to date (2013)..............................................23
8.0 CONCLUSION & RECOMMENDATION.......................................................................25
9.0 Bibliography.......................................................................................................................26
APPENDIXES.........................................................................................................................27

BBPPW3103

1.0 INTRODUCTION

The purpose of this report is to interpret the analytical analysis on the financial reports
on two companies on the same industry for performance evaluation. The evaluation consists
of the financial reports information available from both companies as a medium to
accomplish the test on the financial performance. Moreover, to complete the details of test on
financial ratio analysis on two companies has been carried out. The companies that had been
choose are IGB Corporation and the IJM Corporation which is both in the property sectors
industry. To achieves the accurate measurement the same size of income statement on five
years financial report has been used also to analyse the companies that had been selected the
financial ratio analysis has been carried out.
The overall performance analysed focused on the financial activities and the ability of
each company to sustain on the market compete with their competitor among the industry.
Performance also dedicates to productivity, financing source and value added created by these
companies during operating activities could indirectly boost the company revenue. In term of
shareholder, the company performance could be evaluated by adequate profit available for
distribute as dividend payout.
The result of each company ratio has been compares and analyses to know which
companies perform better. The brief and concise explanation is been made to justify each
evaluation as the proof the evaluation is correct and well judgement on the result each
financial ratio analysis. Further investigation has been made for additional and supplementary
parts also additional information to support the explanation on the financial analysis
performance.

2|Page

2.0 COMPANY PROFILE

BBPPW3103

2.1 IJM CORPORATION BACKGROUND

2.1.1 History:

Resulted from the merger of three medium sized companies on local construction
company, the IJM Corporation had been formed. IJM Corporation was officially establish on
1983 for compete against bigger foreign competitor with more effectively. The company
managed to gained people trust and started to build the reputation on the short period due to
their professionally handling construction group. Their capability is been awarded when the
company aggressively increases in market demanded. In year 2004, they expanded the
business on industrial producer by takeover the Concrete Product Berhad and successfully
diversification into China, India and Pakistan. On April 2007, IJM purchased Road Builder
Group that was their closes competitor at that time in order to sustain their position as one of
the country biggest builder.
2.1.2 Activities:
IJM Corporation is a professionally company manage under competency core
activities consist of construction, property development, manufacturing and quarrying,
infrastructure concessions and plantation. It had been established and growth over the past
three decade with focusing on the variation into tactically related businesses and also
discerning enlargement towards fresh market. Main offices were in Selangor with connecting
to others ten countries among the world with focused on Malaysia, China, Arab and
Indonesia. IJMs started to become developer on property after the successfully experience
in the construction business. The property group then continuously growth extensively over
the year, due to that the IJM Corporation had become one of the major property developer in
Malaysia including spreading cities, profitmaking building and also skyscraper condominium.

3|Page

2.1.3 Market strength:

The result of merger between three medium size of local construction formed a
strongly company that could be compete with the bigger size company. The developing in a
growing presence and operational in more than 10 countries with primarily focused on
Malaysia ensure the competencies and creates the advantages among their competitors.

4|Page

2.2. IGB CORPORATION BACKGROUND

2.2.1 History:
The IGB Corporation is major in property industrial in Malaysia and abroad. As the
pioneer property developer, this company has set the industry standard in property sector
where many continue others company also start to follow. They focussed on the residential
and hospitality development. Started with the construction of the Queen Victoria Building on
years 1984 1986 by Ipoh Ltd , The Galeries Victoria in 1988, The Strand and the Mid
Valley Megamall on year 1999. The latest construction property is The Gardens Mall.
2.2.2 Activities:
IGB Corporation is leading property development on this country and being listed to
the bursa saham main board in Malaysia. They are major in construction, property
development, retail development and hospitality activities. They also were focusing in
diversification of activities under construction. Among the achievement they received is Mid
Valley Megamall where they being awarded for Best Retail Development, Kuala
Lumpur City Halls Best and cleaning shopping centre 2001. Therefore, they also got
award as the Retail Excellence Award 2006/2007.
2.2.3 Market strength:
In 2012, for the tens consecutive years the IGB Corporation was among Top Ten
Property Developers received. Since 1999, the establishment of Mid Valley Megamall, they
had received 18 awards and accolades. They had the investment policy to be the best among
the construction developer in the country also internationally. They provide the regular and
stable distributions, sustainable long term while maintaining the appropriate capital structure

5|Page

4.0 ABSTRACT OF INCOME STATEMENT

IGB CORPORATION BERHAD

Consolidated Financial Statement for year ended 2009 until years 2012

Revenue
Cost of sales
Gross profi t
Other operating income
Administrative expenses
Other operating expenses
Profi t from operations
Finance cost
Share of results of
associates
Gain on disposal of an
associate
Profi t before tax
Tax expense
Equity holders of the
Company
Minority interests
Profit for the financial
year

2009
RM'000
642,442
-281,589
360,853
47,030
-151,432
-16,371
240,080
10,765

2010
RM'000
719,360
-259,979
459,381
33,885
-179,547
-23,953
289,766
17,158

2011
RM'000
772,129
-326,996
445,133
121,894
-187,855
-2,976
376,196
22,088

2012
RM'000
993,851
-372,534
621,317
39,075
-263,006
-3,737
393,649
31,719

-57,142

-53,753

-55,918

-69,588

27,833
221,536
-42,316

24,751
277,922
-77,966

15,138
357,504
-90,655

10,418
366,198
-144,154

158,978
20,242

174,617
25,339

237,650
29,199

180,190
41,854

179,220

199,956

266,849

222,044

IJM CORPORATION BERHAD

Consolidated Income Statement for year ended 2009 until years 2012
2009
Operating revenue
4,601,294
Cost of sales
-3,703,848
Gross profit
897,446
Other operating income
157,265
Tendering, selling and distribution
expenses
-93,413
Administrative expenses
-154,698
Other operating expenses:
-111,044
Operating (loss)/profit before finance
cost
695,556
Finance cost
-189,090
Operating (loss)/profit after finance cost 506,466
Share of profits of associates
19,046
Share of profits/(losses) of jointly
controlled entities
3,158
(Loss)/profit before taxation
528,670
Income tax expense
-126,703
Income from continuing operations
before
Equity holders of the Company
290,212
Minority interest
111,755
Net (loss)/profit for the financial year
401,967

2010
4,013,530
-3,060,100
953,430
208,933

2011
2012
3,720,717 4,517,860
-2,729,703 -3,370,011
991,014
1,147,849
322,469
268,340

-93,927
-182,681
-137,057

-106,128
-227,933
-142,099

-129,033
-202,465
-112,184

748,698
-201,421
547,277
19,676

837,323
-194,986
642,337
46,844

972,507
-172,875
799,632
39,799

11,071
578,024
-154,860

-29,450
659,731
-197,194

-37,840
801,591
-251,105

332,580
90,584
423,164

304,491
158,046
462,537

409,076
141,410
550,486

6|Page

5.0 SUMMARY COMPUTATION OF RATIO

IJM CORPORATION
2009

2010

2011

2012

PROFITABILITY RATIO'S
profit margin

8.74

10.54

12.43

12.18

return on asset (ROA)

3.43%

3.37%

3.68%

3.96%

Return on Equity (ROE)

42.67%

31.88%

34.23%

39.84%

Return on capital employed

5.8

5.6

6.4

6.8

RM

1 962 833

2 913 541

3 163 059

3 565 712

Time
s
Time
s

1.59

2.09

2.18

2.21

1.47

1.89

1.96

2.04

Asset Turnover

Time
s

0.39

0.32

0.29

0.33

Inventory Turnover

Time
s

10

Average Collection Period

Days

16

35

38

22

Average Payment period

Days

97

101

86

105

0.51

0.48

0.48

0.49

2.85

2.49

2.44

2.82

LIQUIDITY
Net Working Capital
Current Ratio
Quick Ratio
ACTIVITY/EFFICIENCY

LEVERAGE/GEARING
Debt ratio
Debt to equity ratio

%
Time
s

Times Interest Earned (TIE)

ratio

3.8

3.87

4.38

5.69

sen

23.46

22.69

22.63

29.84

0.18

0.22

0.28

0.19

MARKET VALUE
Earnings Per Share (EPS)
Price/Earnings ratio

sen

7|Page

2009

2010

2011

2012

27.9

27.8

34.56

22.34

PROFITABILITY RATIO'S
profit margin
return on asset (ROA)

4.01%

4.27%

4.99%

3.12%

Return on Equity (ROE)

48.10%

54.00%

71.62%

60.00%

Return on capital employed

6.04%

7.28%

8.72%

7.24%

639338

438686

708592

1894451

LIQUIDITY
Net Working Capital

RM

Current Ratio

Time
s

2.3

1.62

2.06

Quick Ratio

Times

2.17

1.53

1.96

14 days

15 days

14 days

14 days

3.72
3.63

ACTIVITY/EFFICIENCY
Asset Turnover
Inventory Turnover

Time
s

4 times

4 times

12 times

15 times

Average Collection Period

Days

73 days

47 days

104 days

77 days

Average Payment period

Days

281 days

367 days

85 days

29 days

Debt ratio

36.78%

30.53%

31.79%

33.37%

Debt to equity ratio

1.35%

0.97%

1.38%

2.25%

4.88

6.17

7.17

6.26

Earning Per Share (EPS)

10.9

12

16.3

12.5

Price/Earning ratio

0.18

0.17

0.15

LEVERAGE/GEARING

Times Interest Earned (TIE)

MARKET VALUE

IGB CORPORATION

8|Page

0.18

6.0 Analysis on the ratio

6.1.0 PROFITABILITY RATIO
2009

2010

2011

IJM

IGB

IJM

IGB

profit margin

% 8.74

27.9

10.54

return on asset (ROA)

% 3.43

4.01

Return on Equity (ROE)

% 42.67

Return on capital
employed

% 5.8

IJM

2012
IGB

IJM

IGB

27.8 12.43

34.56

12.18

22.34

3.37

4.27 3.68

4.99

3.96

3.12

48.1

31.88

54

71.62

39.84

60

6.04

5.6

7.28 6.4

8.72

6.8

7.24

34.23

Profit margin is indicates how much the company generates profit from sales, therefore
becoming high percentage is better. This ratio allows the companies to determine how well
they are doing in the sector and how they can manage to compete wilcompetitors. Based on
the table above, we can see that IGB has a better profit margin compare to the IJM
Corporation. It indicates that the IGB Corporation has a high revenues generates on each sales
and also shows the they have effective in managing cost and turning sales into profit. IGB
Corporation stated the highest ratio on year 2011 where it shows 34.56 percent from the sales.
However, the profit margins percent it moving down back on year 2012 from 34.56 to 22.34.
Even though the IGB Corporation is dropped a number in percentage they still manage to get
higher than their competitor IJM Corporation. A good percentage of profit margins will attract
the investors and shareholder.
Return on assets, is indicator how well the company managed their assets in generating
earning. During year before 2009, the IJM Corporation has a negative percentage due to them
making losses on that year. Consequences from that we can know that the company not wisely
and managed in allocating the resources. However the IJM Corporation is doubling the effort
for sustain be able get profit for forward year. The IGB Corporation strongly stay ahead of their
competitor until year 2011 where they recorded high percentage of return on asset. However in
year 2012 the IJM Corporation successfully led the competition by 0.84 percent. Therefore, it
indicates the IJM Corporation also can compete even though has a lower percentage as
beginning.Return on equity is ratio of net income of business towards their stockholders equity.
9|Page

Return on capital employed (ROCE), usually used for comparing the performance of
companies in capital leverage on the business. This ratio indicates on financial performance of
the companies in a better way with a significant debt. The IGB Corporation has a better
percentage on capital employed compare to the IJM Corporation. On year 2011, the IGB
Corporation states the high percentage that is 8.27percent compare to the IJM Corporation that
only had 6.4 percent. This shows the IGB Corporation has a better job of deploying its capital
than IJM Corporation. This shows the IGB Corporation has superior rather than IJM
Corporation. This indicates IGB has a better financial performance for companies with
significant debt. In generally, the ROCE trend over the years is important indicator over the
year because the investors are likely to favour company with stable and rising ROCE.

Graphicalrepresentation:
Profitability Ratio
80
70
60
50
40
30
20
10
0
-10
-20

profit margin %

IJM
IGB
2008

IJM
IGB
2009

IJM
IGB
2010

IJM
IGB
2011

IJM
IGB
2012

-6.47 25.12 8.74 27.9 10.54 27.8 12.43 34.56 12.18 22.34

return on asset (ROA) % -2.69 3.88 3.43 4.01 3.37 4.27 3.68 4.99 3.96 3.12
Return on Equity (ROE)
%

34.93 46.4 42.67 48.1 31.88

Return on capital
employed %

-0.05 3.55

10| P a g e

5.8

6.04

5.6

54
7.28

34.23 71.62 39.84 60

6.4

8.72

6.8

7.24

6.2.0 LIQUIDITYS RATIO

6.2.1 Net working capital
IGB CORPORATION
YEARS
Current asset RM000
Current liability RM000

2009
1 131 240
491 902

2010
1 145 045
706 359

2011
1 376 250
708 592

2012
1 376 250
697 478

Net Working Capital RM000

639 338

438 686

708 592

1 894 457

IJM CORPORATION
YEARS
Current asset RM000
Current liability RM000

2009
5 313 043
3 550 210

2010
5 598 766
2 685 225

2011
5 848 682
2 685 623

2012
6 518 546
2 952 834

Net Working Capital RM000

1 962 833

2 913 541

3 163 059

3 565 712

The net working capital indicates the whether the company current assets is more
than current liabilities or not. If the company has the current liabilities more than the
current assets they are probably run in trouble in paying back theirs creditors in the short
term. There could be more serious case could occur are bankruptcy.
For the IGB Corporation, on the year 2008 to 2009 the net working capital shows an
increasing in numbers by RM 132 340 000 which is indicates a good operational efficiency.
Therefore, it reflects the company has cash and short term assets expected to covered the
short term debt. However, on year 2010, the company has significantly dropped the number
of net working capital. This is due to the high numbers amounted on the current liability
versus current assets on that particular year. Moreover, the company manage to catch up the
high level of net working capital on row from year 2010 until 2012. This shows, they had an
adequate liquid asset. Positive working capital ensures the firm able to continue its operation
and have a significant enough funds for finance theirs short term debt. On year 2012, the
company has highest net working capital, it could be from the action of company buying
huge quantity of inventories so their current assets are increase and steadily high from
previous years.

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For the IJM Corporation, the company starts net working capital on year 2008 at RM2
331 254 but the company had severe fall on year 2009 by RM 360 421 000. It shows the
company less efficiency on operational, which means the company, fails to maintain or
expands their operational. Less net working capital reflect the company has less cash and
short term assets to be liquidity to covered current liability. Therefore, it also could be relate
the company is not operating in the most efficient manner and also slows collection on their
account receivable. However, the company has improves and steadily increase their net
working capital since year 2010 until 2012. The increasing amount on cash means the
company has available to fund the growth and other initiative purpose. In additional, the high
net working capital also defined ability of the company itself in managing their resources and
quickly changes it into cash. The cash that could also been used for reinvest purpose.

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6.2.2 Current ratio

Years

2009

2010

2011

2012

IJM CORPORATION

Times

1.59

2.09

2.18

2.21

IGB CORPORATION

Times

2.3

1.62

2.06

3.72

The IJM corporation shows among the five years operational, their current ratio are
almost the same. The levels of the ratio are moderated but still consider good as the company
can cover current liabilities over current assets as they can maintain a ratio above 1.50. As
generalize, usually a good performance of company has a current ratio between 1.5 until 2.0.
Although it also should looking on the type of industry and the business that entity is been
run. The liquid ratio of IJM Corporation is been decreases to 1.59 on year 2009. This might
due from the cash and bank balances is reduced because that is used for dividend payment
purpose. For year 2010 to 2012 the ratio is steadily increases.
The IGB Corporation has a better ratio which is 1.50 and above for the five year in a
row. The ratio is continues growing up accept for the year 2010 where there is significant
dropped from 2.3 to 1.62, where the lowest current ratio that had been recorded for this
company among five years. On year 2012, the company has stated the highest ratio which is
3.72 compare to the previous year. The increasing on current ratio shows the IGB
Corporation had taken seriously in their ability to paid up their short-term debt, this would
probably enhance assurance of investors, shareholders and outsider about their ability to pay
debt over the next 12 month.

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Graphical Representation :

Based on the graph we can see, the IGB Corporation and IJM Corporation have
constant increase on year 2008. But for year 2009 the IJM Corporation significantly dropped
while IGB Corporation had steadily improved. From year 2009 until 2012 the IJM
Corporation strive to maintain their good ratio condition to compete with other company from
the same sector, as a result they keep increasing the current ratio until years 2012.

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6.2.3 QUICK RATIO

IGB corporation

Times

2.17

1.53

1.96

3.63

IJM corporation

Times

1.47

1.89

1.96

2.04

Quick ratio is been interpret as a company short term liquidity to measure ability to use
their quick assets for paying current liabilities purpose. In additional, the ideal quick ratio
should be 1:1. Based on the table above, we can see the IJM Corporation has a stimulating
condition where the quick ratio shows indicated this company has manage their quick assets
properly in the five year business operational. The ratio seem decrease from 1.74 to 1.47 on
year 2009, this might be due to decrease on the cash or account receivable balances. However,
the ratio is maintained increased every year since 2010 until year 2012.
For the IGB Corporation, the ratio start with 2.17 on year 2009 indicates a good
numbers where it reflects a good condition of the company. It slightly increase on year 2009
from to 2.17, it might have an advantage and disadvantage in a different term. The high ratio
may indicate the company keep too much cash on hand or problem in collecting their account
receivable. However, high ratio also shows this company can meet their current financial
obligation with quick fund on hands. The highest ratio for this company stated on year 2012
where it shows a ratio 3.63. High number in quick ratio is needed when the company had
difficulty borrowing on short term funds.
Graphical Representation:
Quick ratio
4
3
2
1
0
years

2008

2009

IJM Corporation

15 | P a g e

2010
2011
IGB
Corporation

2012

6.3.0 Activity/Efficiency Ratio

2009
IGB
Asset Turnover

ratio

Inventory Turnover

2010

IJM IGB

IJM

2011
IGB

IJM

2012
IGB

IJM

0.14

0.39

0.15

0.32

0.14

0.29

0.14

0.33

Times

10

12

15

Average Collection
Period

Days

73

16

47

35

104

38

77

22

Average Payment
period

Days

281

97

367

101

85

86

29

105

Comment:
Asset turnover ratio indicates the firm efficiency at using theirs assets in generating sales
or revenue which means the higher the number is better. For the overall, the IGB Corporation has a
lower asset turnover ratio compare to the IJM Corporation along the five years operational. This
shows the IJM Corporation has higher growing revenue in proportion to sales compare to the IGB
Corporation. Means, IJM Corp has utilised at using their assets efficiencies compare to their
competitor. Moreover, this also indicates the prices strategy that the company had been used where
the high assets turnover shows the company had low profit margin compare to the lower asset
turnover company which had a high profit margin. We can conclude that the IJM Corporation has a
better amount of sales that can be generated for every ringgit malaysia worth of assets compare to
their competitor IGB Corporation.

Inventory turnover shows how the company manage and selling their inventory which
ensured the company efficiency on handling firms inventories. For the first three years, the
IJM Corporation shows an encouraging numbers of inventory turnover which means they had been
sold their inventory effectively compare to the IGB Corporation that had significantly lower in the
inventory turnover over the three years period. Low inventory turnover might risk the company as
they are holding an obsolete inventory that would make inventory less quality while holding it. It
may eat up companys profit if holds inventory in long time period. Moreover, high inventory
turnover shows a good condition of the company in the market but somehow if there is too high
inventory turnover would lead to the stockouts.

16 | P a g e

This is not a good indicator, as the stockouts take time to re-stock the inventory and
give a negative perspective towards the clients. That because some of the clients need stock to
be in time when they are been ordered and some of them would not tolerate if any delay
happen, this would lead to loss if this situation occur. These explain why IJM Corporation had
sudden dropped in year 2011 to year 2012 while IGB Corporation steadily increased.
Average collection period are estimates average of business to received payment from
their debtors. The IJM Corporation has a high number in days to get the payment from their
debtors compare to the IGB Corporation. However, this might due to the IJM Corporation has
more inventory turnover compare to the IGB Corporation which means IJM Corp had highly
account receivable that would increase the day collection received. IGB Corp has low
collection period indicated a good as they can get payment quickly from the debtors,
moreover their inventory turnover is bit lower so they is expected to get collection of debt
faster compare to the IJM Corp. Same goes to years 2011 until years 2012, where the IJM
Corp has low average collection period which indicates good condition but it also due to their
slightly decreases in inventory turnover where reduced in account receivable. In overall, both
company had a good approximates amount of time taken for average collection period over
five years operational business.
Average payment period, shows the numbers of days or month that company can pay
their creditors. It represents how well company can pay credit purchases. For year 2009 , the
IGB Corporation have a better average payment period compare to the IJM Corporation
which presents lower average payment period. IJM Corporation shows they lag 46 days
behind its competitor IGB Corporation in term of payment. However, in year 2009 until years
2010 IGB Corporation has high average of payment compare to IJM Corporation, it will
create risk for their company as it shows company fails to manage liquid assets and bad
reputation among creditors. Somehow, the IGB Corporation rise from the fall and continued
to create success when years 2011 until years 2012 shows huge improvement as the number
in average payment period is dropped significantly compare to the IJM Corporation.

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6.4.0 LEVERAGE / GEARING RATIO

2009
JM

2010

2011

2012

IGB

IJM

IGB

IJM

IGB

IJM

IGB

Debtratio

Ratio

0.51 0.37

0.48

0.31

0.48

0.32

0.49

0.33

Debttoequityratio

Times

2.85 1.35

2.49

0.97

2.44

1.38

2.82

2.25

TimesInterestEarned

ratio

3.8

3.87

6.17

4.38

7.17

5.69

6.26

4.88

Debt ratio measures how much the company are being financed through debt. Basically,
debt ratio above 1 indicated their company are financed more from debt. Therefore it also means
the company a highly debt leveraged firm. As the overall for both company, they shows a good
debt ratio which means the proportion of the company assets financed by debt are fairly low and it
finance more from equity rather than debt. Compare to the both company, the debt ratio for IJM
Corporation has a little high rather than IGB Corporation. The IJM Corporation with high ratio
usually placing them at a risk especially under the property market sector business, because this
sector usually had a floating rate of market price. Debt to equity ratio indicated how much the
company financed their assets by using debt and shareholders equity of the business. Lower
ratio is more preferable as itindicated less risk. If the company is highly in debt, means they
tend to pay at higher interest rates as the banks usually places a high rate of interest for the
company that has a high risk. Based on the table above, we can see the IJM Corporation has high
debt to equity ratio compare to the IGB Corporation. We can conclude that the IGB Corporation
has a better financed their money through equity compare to the debt along the five years
operational.
Times interest ratio, indicates the ability of the company to meet the debt obligation when
it is due to. It measures how much the company can repay back their debt when it needed. The
high ratio means the company is able to pay their debt, whereas if the times interest earned ratio is
under 1 means the company is having a problem in generating enough funds to pay back their
debt. Under this circumstances, we can see the IJM Corporation having a hard time to pays their
debt obligation on year 2008 with the ratio 0.08 compare to the IGB Corporation that have ratio
4.73 which had a better in managing their outstanding debt. For over five years operational, the
IJM Corporation is struggling to keep their business in repayment ability within the similar
company under same sector of business.
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Graphicalrepresentation:

Leverage/Gearing
Ratio
8

IJM

IGB

2008
Debt ratio Ratio
Debt to equity ratio
Times
Times Interest Earned
ratio

JM

IGB
2009

IJM

IGB

2010

IJM

IGB

2011

IJM

IGB
2012

0.49

0.38

0.51

0.37

0.48

0.31 0.48

0.32

0.49 0.33

3.28

1.3

2.85

1.35

2.49

0.97 2.44

1.38

2.82 2.25

0.08

4.73

3.8

4.88

3.87

6.17 4.38

7.17

5.69 6.26

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6.5.0 MARKET VALUE.

2009
IJM
Earnings Per Share (EPS) sen
Price/Earnings ratio

sen

IGB

2010

2011
IGB

2012

IJM

IGB

IJM

IJM

IGB

23.46 10.9

22.69

12

22.63 16.3

29.84 12.5

0.18 0.18

0.22

0.17

0.28 0.15

0.19 0.18

Earningspershare(EPS)arebeingconsideredtodeterminehowmuchtheshareprice
ofthecompany.Whilecalculatingtheoutstandingshares,itmorepreferabletousedweighted
averagenumberssharesoutstandingbecausethenumbersofsharescanbeeasilychangeand
convertible.Foroverallfiveyearsoperationalfromyears2008untilyears2012,theIJM
CorporationshowsbetterearningspershareandhigherthanIGBCorporation.Onoverallthe
IJMCompanyhasaveryencouragingimprovementontheirbusiness.IJMCorporationstated
steadilygrowthforfiveyearsbusinessoperational.FortheIGBCorporation,eventhough
theyarehavinglowearningpersharethereforetheyalsoshowanimprovementalongthefive
yearbusinessoperational.IGBCorporationstartfrom10.5senthenincreaseto12.0senupto
years2012.
Price earnings ratio can be defined as the market price per share on current years
dividedbyearningpersharesonthecurrentyears.P/Eratioisusuallyusedbytheinvestorsto
evaluatethegrowthofthecompanyinafuture.HoweverP/Eratiocantshowsthewholestory
offuturegrowthofcompany.Itmoreusuallyusedtoevaluatecompanywithinthecompetitors
underthesameindustrialandasabasisagainstcompanyownhistoricalP/Eratio.Aswecan
see,theIJMCorporationhadanegativenumberonyear2008whichis0.24.Thisbecauseof
theconsequencesofthebusinesswheretheyfailtogeneratesrevenueandhavinglossesonthat
year. The next year, IJM Corporation had recorded rapidly growth thus ahead from their
competitoruntilyear2012.

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7.0 The Overview of Company Performance up to date (2013)

Based on the current share price up to date 21 October 2013, there is an increase on
the value of share close at the high. Means the IJM Corporation stock are in demanded by
investors. When more people wants to buy stocks from company the price is moves up. The
reason of IJM Corporation increasing demand on stocks due to the investors finds that, this
company is worth. In addition, the financial report release helps the investor to evaluate
company performance and wealthy based on historical. Moreover, the investor also tend to
buy this company stock because of the high P/E ratio where there is indicates the future
growth of the company (based on the earlier analysis) is better. However, share price
doesnt same with the value of company which called market capitalization. The market
capitalization is the total market value of company outstanding shares. Therefore, market
value is total value on currency of the company stocks.

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Aswecansee,thetableofmarketpriceanalysebybursasahamshowstheIGB
Corporationclosedthestockpriceatthesame.Thereisnochangeuptodaterelatedtothe
companystocksprice.ThereforewecanconcludethattheIGBCorporationmarketgrowth
developmentisquiteslowscomparetotheircompetitors.Italsocouldberelatedtotheearlier
analysisontheP/Eratiowhichthiscompanyhassignificantlyloweranditwouldmakethe
investorthinktwicebeforeinvestonbuyingthiscompanystocks.Moreoverthiscompany
alsomakeaprofitfromthefinancialreportthathadbeenreleasedbutitmoretomoderate
andtherangeissustainablecomparetotheothercompetitorthathasabombasticrevenueon
theirfinancialperformance.

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8.0 CONCLUSION & RECOMMENDATION

Basedonthestudiesthathadbeencarriedout,wefoundouttheIJMCorporationhas
abetterperformanceandhadasteadilygrowthcomparetotheIGBCorporation.Itcanbe
provebycomparingthetestthatbeingperformforbothcompanies.Asweknow,attheearly
stagetheIJMishavingdifficultyingeneratingrevenuesandhavinglosses,howeverthey
prove this company could manage and creates competitive among the same industrial.
Moreover, the IJM Corporation is better because of their financial strategies and creates
potentialopportunitytokeepprofitstability.Despitebeatingthemarketexpectation,theIJM
Corporationreflectthoughmarketconditionsandpressurestoachievegoals.Becauseofthat,
IJMhasdevelopedandfocusedonthecustomerretentionandalsoconductaresearchto
understandwellabouttheirstrengthandweakness.Theinformationofthecompanysurvival
canbeknowsfromtheannualreportofthiscompany.
Recommendationbasedontheanalysisthathadbeencarriedout,eachcompanythat
runabusinessshouldcreateacultureoftrust.Thehonestcommunicationcoulddiminish
differencesamongteamworkersandenhancesthetransparencyamongtopandbottomline
workers.Thiscouldleadtoimprovementandefficiencyofworkerssothentheperformance
of company also could be surge. Thus the outsider such as investors attracted to the
organizationthathadgreatculturevaluesamongthem.Secondly,thecompanyshouldpay
attentiontowardbecomingthebestinclassasbenchmarkingtowardothercompetitor.This
couldenhancethecompanygoalsandvisiontowardmoreeffectiveandputaneffortbyusing
thebestapproachtobecomefavourablecompanyintheindustry.

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9.0 Bibliography

Referred books
I.

Power & needles, 2012, financial accounting, international edition Cengage Learning
AI. Andrew Thomas and Anne Marie Ward, (2009), Introduction to Financial
Accounting, sixth edition. The McGraw-Hill Companies Education.
BI. Lawrence J.Gitman and Chad J.Zutter (2009) ,Principle of Managerial Finance,
thirteen edition, Pearson, global edition.

Internet Site

I.

V.

www.wikipedia.com
II.
www.investopedia.com
III.
www.biz.co.uk
IV. www.klse.com
www.thestar/bizonline/org.com

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APPENDIXES (IGB CORPORATION)

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IJM CORPORATION

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