05.21.2001
Compal makes internal 2001 EPS forecast of NT$2.82

• Compal (2324 'Ren Bao') has made an informal 2001 EPS forecast of NT$2.82 in the appraisal report on the merger of subsidiary Palmax (unlisted), a handheld device maker. Compal predicts revenue to grow 31% YoY, while gross margin is expected to slump to 8.06% this year from 9.16% in 2000 (9.21% in 1Q01). Consolidated pretax profit post-merger is estimated to be NT$6.1b, a slight 3.3% YoY decline.

• Adjusted to the recent GDR issue, stock dividend issue and new share issue for the merger, total paid-in capital will expand 32.9% to 206.9m shares, from 155.7m at the end of last year. As a result, after-tax EPS is diluted to NT$2.82.

• VB Primasia Investment Opinion: Our 2001 pretax profit forecast stands at NT$6.6b, for fully diluted EPS of NT$3.05. We maintain our earnings projection and ACCUMULATE rating on Compal.

MarthaChen@Primasia.com +886-[0]2-2547-8878