Investment Analysis Group Project

Investment Analysis Group Project
First Semester Session 2019/2020 (A191)
Group D
Submitted to
Dr. Adilah binti Azhari
Submission Date
30 November 2019
Prepared By
Name Matric Number

Teo Ziang Han 252978
Thong Wei Ming 253105
Tan Shi Er 253291
Lai Kah Lok 253415
Augustus Saw Pheng Hong 253562
Table of Contents
1.0 Introduction 5
2.0 Economic Analysis 6
2.1.0 Malaysia 6
2.1.1 Monetary Policy and Fiscal Policy 6
2.1.2 Gross Domestic Malaysia 7
2.1.3 Unemployment Rate 8
2.1.4 Inflation Rate 9
2.1.5 Consumer Price Index 10
2.1.6 Balance of Trade 11
2.2.0 United State of America 13
2.3.0 Japan 20
3.0 Industry Analysis 28
3.1.0 Heineken Malaysia Berhad 28
3.1.1 Business Overview of Heineken 29

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3.1.2 SWOT Analysis 30
3.1.3 Competitor Analysis 32
3.2.0 Dutch Lady Milk Industries Berhad 33
3.2.1 Business Overview of Dutch Lady Milk 33
3.3.0 Top Glove Corporation Berhad 38
3.3.1 Business Overview of Top Glove 38
3.4.0 McDonald’s Corporation 42
3.4.1 Business Overview of McDonald’s Corporation 42
3.5.0 Panasonic Corporation 50
3.5.1 Business Overview of Panasonic Corporation 50
4.0 Fundamental Analysis 57
4.1.0 Heineken Malaysia Berhad 58
4.1.1 Financial Ratios of Heineken 58
4.1.2 Intrinsic Value of Heineken Malaysia Berhad 67
4.2.0 Dutch Lady Milk Industries Berhad 68
4.2.1 Financial Ratios of Dutch Lady Milk 76
4.2.2 Intrinsic Value of Dutch Lady Milk Industries Berhad 76

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4.3.0 Top Glove Corporation Berhad 78
4.3.1 Financial Ratios of Top Glove 78
4.3.2 Intrinsic Value of Top Glove Corporation Berhad 86
4.4.0 McDonald’s Corporation 88
4.4.1 Financial Ratios of McDonald’s 88
4.4.2 Intrinsic Value of McDonald’s Corporation 96
4.5.0 Panasonic Corporation 98
4.5.1 Financial Ratios of Panasonic 98
4.5.2 Intrinsic Value of Panasonic Corporation 108
5.0 Technical Analysis 108
5.1.0 Technical Analysis of HEIM 108
5.1.1 MACD 108
5.1.2 RSI 109
5.1.3 Moving Average 110
5.1.4 Support and Resistance 111
5.2.0 Technical Analysis of DBMS 112
5.2.1 MACD 112
5.2.2 RSI 113
5.3.0 Technical Analysis of TGLVY 116
5.3.1 MACD 116
5.3.2 RSI 117

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5.4.0 Technical Analysis of MCD 120
5.4.1 MACD 120
5.4.2 RSI 121
5.5.0 Technical Analysis of PCRFY 124
5.5.1 MACD 124
5.5.2 RSI 125
6.0 Portfolio 128
7.0 Conclusion 130
8.0 Reference 132
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1.0 Introduction
According to James Chen (2019), Investment is an asset or item acquired with the
goal of generating income or appreciation of the assets. There are several types of
investment such as fixed income securities, equities, derivatives, mutual fund and so
on. Investors will seek to maximize Returns of investment which is in the form of
dividend and capital gains and minimize risks through diversification.
In this assignment, we are required to select 5 companies from different sectors

and different countries. It can helps us reduced our risks on investment through
diversified our investment into different sectors and countries. Unsystematic risks can
be reduced by investing in companies in different sectors and countries. After that, we
have to monitor our portfolio for 8 weeks from October to the end of November of
2019.
According to Will Kenton, Top-down investing is an investment analysis

approach that involves looking first at the macro picture of the economy, and then
looking at the smaller factors in finer detail. In this assignment, we have divided our
analysis into 4 major parts which are economic analysis, industry analysis,
fundamental analysis and technical analysis. By using these analyses, it would help us
to selecting a good company and invest it at the right entry point.
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2.0 Economic Analysis
Economic analysis is a study of performance on overall activities in a country.

The overall macroeconomic conditions will affect the economic activity of the
business and investment. Good macroeconomic conditions would attract more
investors from local investors and foreign investors to do investment in a country. In
this report, the economic indicators would be used are Gross Domestic Product
(GDP), inflation rate, unemployment rate, consumer price index, balance of trade,
exports and import from Malaysia.
2.1.0 Malaysia
2.1.1 Monetary Policy and Fiscal Policy
Monetary policy is a policy controlled by Central Bank of Malaysia which is

Bank Negara Malaysia. Bank Negara Malaysia controls 3 mains tools in monetary
policy which is overnight policy rate (OPR), open market operations, and reserve
requirement ratio to achieve monetary policy such as price stability and control
inflation rate in Malaysia. Due to the uncertainty of global economic, Bank Negara
Malaysia has reduced OPR by 0.25 percent to 3.00 percentage in May 07, 2019 to
stimulate economic. The purpose is to reducing cost of borrowing from banks to
encourage residents to borrow money from bank with a lower interest rate.
Meanwhile, Bank Negara Malaysia has announced reduced in reserve requirement
ratio from 3.5% to 3% in November of 2019. Thus, Banks would have more funds to
supply to borrowers.
Fiscal policy is a policy control by government Malaysia based on condition of

economic in Malaysia. Government have 2 main tools in fiscal policy which is
government spending and taxes to used in expansionary policy or contractionary
policy. For example, government Malaysia have implemented (East Coast Rail Link)
ECRL project in Peninsular Malaysia in August 2017. The project is a construction of
railway link approximately 640 km that connecting different parts of east coast region
with the west coast region in Peninsular Malaysia. The project is able to enhance
economic Malaysia by providing various jobs to residents Malaysia in ECRL project.
Thus, residents would have more money and willing to spend more that can improve
economic Malaysia by consumer spending.
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2.1.2 Gross Domestic Products
Figure 1: GDP Malaysia Year over Year Growth Rate from 2017 to 2019
The latest Malaysia GDP annual growth rate in third quarter of 2019 is 4.4 per
cent which is equal to the forecast percentage. Growth of GDP was mainly driven by
private consumption, government spending, and net exports. However, the result
compares with the previous result which is second quarterly result the growth rate of
GDP was drop from 4.9% to 4.4%. The weak GDP growth was due to the uncertainty
on global economic and ongoing US and China trade war tensions. After that, GDP
annual growth rate in Malaysia averaged of 4.7% from 2000 until 2019 (trading
economics).
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2.1.3 Unemployment Rate
Figure 2: Unemployment Rate from October 2018 to October 2019
Unemployment in monthly September result of 2019 is maintained at 3.3% and

lower than the forecast result which is 3.4%. Average of unemployment rate in
Malaysia from 1998 to 2019 is 3.28 per cent (trading economics). Lower
unemployment rate shows a good indicator in Malaysia as residents in Malaysia
mostly have a job. Residents would do more consumption by using their wages. Thus,
it can enhance or improve economic of Malaysia by consumer spending.
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2.1.4 Inflation Rate
Figure 3:Year over Year Inflation Rate in Malaysia from October 2018 to October
2019
Based on the figure above, Malaysia's annual inflation rate was 1.1% in October
of 2019 which is equal to the forecast result. The result was remained unchanged from
previous month result. Average of inflation rate in Malaysia from 1973 to 2019 is
3.52% (trading economics). The changes in inflation rate were mainly driven by price
of food, housing prices and transportation cost.
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2.1.5 Consumer Price Index
Figure 4: Consumer Price Index from October 2018 to October 2019
The consumer price index is measured the weighted average of prices of a basket
of consumer goods and services that consumers would frequently used it. Based on
the figure above, the latest CPI result of Malaysia in September was increased to 122
index points compare to the previous month which is 121.80 index points in
September of 2019. Average of CPI in Malaysia from 1972 to 2019 is 71.57 index
points (trading economics). Increase in CPI in Malaysia shows that the cost of living
is increasing in Malaysia.
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2.1.6 Balance of Trade
Figure 5: Balance of Trade from October 2018 to October 2019
Figure 6: Exports from Malaysia
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Figure 7: Imports from Malaysia
Based on the figure above, the latest result of balance of trade in September of
2019 was drop sharply from the previous month which is RM8.3 billion. And also, the
balance of trade is worse than the forecast result which is RM15 billion in September
2019. Decline in trade surplus was due to the exports fell and imports rose since
August Last year (Department of Statistics Malaysia) as shown in the figure 6 and
figure 7. The average of balance of trade in Malaysia from 1970 until 2019 is
RM3,525.44 million (trading economics).
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2.2.0 United States
2.2.1 Monetary Policy and Fiscal Policy
Central banks typically have used monetary policy to either stimulate an

economy or to check its growth. By incentivizing individuals and businesses to
borrow and spend, the monetary policy aims to spur economic activity. Conversely,
by restricting spending and incentivizing savings, monetary policy can act as a brake
on inflation and other issues associated with an overheated economy. The Federal
Reserve, also known as the "Fed," frequently has used three different policy tools to
influence the economy: open market operations, changing reserve requirements for
banks and setting the discount rate. Open market operations are carried out daily when
the Fed buys and sells U.S. government bonds to either inject money into the
economy or pull money out of circulation. By setting the reserve ratio, or the
percentage of deposits that banks are required to keep in reserve, the Fed directly
influences the amount of money created when banks make loans. The Fed also can
target changes in the discount rate (the interest rate it charges on loans it makes to
financial institutions), which is intended to impact short-term interest rates across the
entire economy. Monetary policy is more of a blunt tool in terms of expanding and
contracting the money supply to influence inflation and growth and it has less impact
on the real economy. For example, the Fed was aggressive during the Great
Depression. Its actions prevented deflation and economic collapse but did not
generate significant economic growth to reverse the lost output and jobs.
Expansionary monetary policy can have limited effects on growth by increasing asset
prices and lowering the costs of borrowing, making companies more profitable.
The aim of most government fiscal policies is to target the total level of
spending, the total composition of spending, or both in an economy. The two most
widely used means of affecting fiscal policy are changes in government spending
policies or in government tax policies. If a government believes there is not enough
business activity in an economy, it can increase the amount of money it spends, often
referred to as stimulus spending. If there are not enough tax receipts to pay for the
spending increases, governments borrow money by issuing debt securities such as
government bonds and, in the process, accumulate debt. This is referred to as deficit
spending. By increasing taxes, governments pull money out of the economy and slow
business activity. Typically, fiscal policy is used when the government seeks to
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stimulate the economy. It might lower taxes or offer tax rebates in an effort to
encourage economic growth. Influencing economic outcomes via fiscal policy is one
of the core tenets of Keynesian economics. When a government spends money or
changes tax policy, it must choose where to spend or what to tax. In doing so,
government fiscal policy can target specific communities, industries, investments, or
commodities to either favour or discourage production—sometimes, its actions are
based on considerations that are not entirely economic. For this reason, fiscal policy
often is hotly debated among economists and political observers. Essentially, it is
targeting aggregate demand. Companies also benefit as they see increased revenues.
However, if the economy is near full capacity, expansionary fiscal policy risks
sparking inflation. This inflation eats away at the margins of certain corporations in
competitive industries that may not be able to easily pass on costs to customers; it also
eats away at the funds of people on a fixed income.
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2.2.2 Gross Domestic Products
Figure 1: GDP United States Year over Year Growth Rate from 2017 to 2019
The US economy grew by an annualized 2.1 percent in the third quarter of

2019, compared to an advance estimate of 1.9 percent and following a 2.0 percent
expansion in the previous three-month period. Upward revisions to private inventory
investment, nonresidential fixed investment, and personal consumption expenditures
(PCE) were partially offset by a downward revision to state and local government
spending. GDP Growth Rate in the United States averaged 3.21 percent from 1947
until 2019, reaching an all time high of 16.70 percent in the first quarter of 1950 and a
record low of -10 percent in the first quarter of 1958.
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2.2.3 Unemployment Rate
Figure 2: Unemployment Rate from January 2019 to October 2019
The US unemployment rate increased to 3.6 percent in October 2019 from 3.5
percent and in the previous month in line with market expectations. Unemployment in
monthly July result of 2019 is maintained at 3.7% and lower than the forecast result
which is 3.4%. The labour force participation rate was little changed at 63.3 percent in
October, and the employment population ratio held at 61.0 percent. Both measures
were up by 0.4 percentage point over the year. Average of unemployment rate in
United States from 1998 to 2019 is 3.28 per cent (trading economics). Lower
unemployment rate shows a good indicator in Malaysia as residents in United States
mostly has a job. Residents would do more consumption by using their wages. Thus,
it can enhance or improve United States economic by consumer spending.
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2.2.4 Inflation Rate
Figure 3: Year over Year Inflation Rate in United States from January 2019 to
October 2019
Annual inflation rate in the US increased to 1.8 percent in October of 2019

from 1.7 percent in September and higher than market expectations of 1.7 percent.
The index for all items less food and energy rose 2.3 percent over the last 12 months.
The food index rose 2.1 percent over the last 12 months, while the energy index
declined 4.2 percent over the last year despite increasing in October. On a monthly
basis, consumer prices went up 0.4 percent, above a flat reading in September and
forecasts of 0.3 percent. The energy index increased 2.7 percent in October after
recent monthly declines and accounted for more than half of the increase in the
seasonally adjusted all items index. Inflation Rate in the United States averaged 3.25
percent from 1914 until 2019, reaching an all-time high of 23.70 percent in June of
1920 and a record low of -15.80 percent in June of 1921.
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2.2.5 Consumer Price Index
Figure 4: Consumer Price Index from January 2019 to October 2019
In the United States, the Consumer Price Index or CPI measures changes in
the prices paid by consumers for a basket of goods and services. This page provides
the latest reported value for - United States Consumer Price Index (CPI) - plus
previous releases, historical high and low, short-term forecast and long-term
prediction, economic calendar, survey consensus and news. United States Consumer
Price Index (CPI) - actual data, historical chart and calendar of releases - was last
updated on November of 2019.
Consumer Price Index CPI in the United States increased to 257.27 Index
Points in October from 256.36 Index Points in September of 2019. Consumer Price
Index CPI in the United States averaged 113.48 Index Points from 1950 until 2019,
reaching an all-time high of 257.27 Index Points in October of 2019 and a record low
of 23.51 Index Points in January of 1950.
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2.2.6 Balance of Trade
Figure 5: Balance of Trade from October 2018 to July 2019
The US trade deficit narrowed to USD 52.5 billion in September from USD 55
billion in the previous month, matching market expectations. It is the lowest trade gap
since April as imports from Germany and China declined and US reported first
petroleum surplus since 1978. Exports declined 0.9 percent led by soybeans and
automobiles, while imports slumped 1.7 percent due to purchases of cell phones, toys,
games & sporting equipment, semiconductors and automobiles. Balance of Trade in
the United States averaged -15029.11 USD Million from 1950 until 2019, reaching an
all-time high of 1946 USD Million in June of 1975 and a record low of -67823 USD
Million in August of 2006.
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2.2.0 Japan
2.2.1 Monetary Policy and Fiscal Policy.
Monetary policy is a tool that used by central bank to control the money supply in the
economic through the use of interest rate. The tools that used in monetary policy are
discount rate, required reserve ratio and open market operations. These tools are
control by central bank in order to maintain positive economic growth, control the
inflation rate and achieve full employment.
The central bank of Japan has implemented its monetary policy by its own rules
where they decided that their monetary policy by aiming for price stability. Price
stability defined as the maintenance of the price in the economic at a certain price
range. By having price stability, the country will be able to reduce the frequency of
inflation and deflation that happen for long periods. The central banks of Japan
believe that price stability is the basic of economic transaction and activities in Japan.
Individual always faced purchasing decision in their life. The decision of the
individuals is easily influenced by the price level of goods and services. It’s same
goes with investors. Wise investor will make their investment decision when the
economic is strong. If the central bank of Japan unable to maintain the price stability
in the economic, it will cause the efficiency of resources allocation to decrease.
Money market operation is used by the central bank of Japan in order to implement
the monetary policy in Japan. The operations have to follow the rules set by Bank’s
Policy Board in the Money Policy Meeting. By using money market operations, the
central bank of Japan will provide funds for financial institution. The financial
institution will use the fund to create the money supply to the economics.
Next, fiscal policy is policy used by government to influenced the economy through
its tax and government spending. Expansionary fiscal policy is used when the
economy is facing a recession by decrease the tax and increase the government
expenditure in order to stimulate the economy. Contractionary fiscal policy is used
when the economy is in inflation state through the increase tax and decrease the
government expenditure to slow down the economy.
Japan government also makes fixed investment in the public and private sector.
Government will always ensure that the development of potential firms and industry
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go smoothly because they believe that it will be able to assist the development of
Japan economics.
From the monetary policy and fiscal policy that implemented by Japan, we can see
that Japan has done well in the development of economic. So, investing in the stock of
Japan is considered as low risk and the country risk that concerned by investors on
trading international stock will be minimized.
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2.2.2 Gross Domestic Products.
Figure 1: GDP Japan Year over Year Growth Rate from 2017 to 2019
Gross domestic product (GDP) is the measurement of national income and output of
country economics. Growth of GDP is equal to the total expenditure of all final goods
and services produce within the country in a stipulated time period.
From the figure above, the GDP growth rate of the first quarter of year 2019 started at
0.9%. The GDP growth rate still maintain at 0.9% at the second quarter of 2019. At
the third quarter of 2019, the GDP growth rate increase to 1.3%. As Japan economy is
the fourth largest in the world, it is fully diversified and technologically advanced.
The contribution of each sector helps to maintain the growth rate of GDP in Japan.
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2.2.3 Japan Unemployment Rate
Figure 2: Unemployment rate of Japan from October 2018 to September 2019
The unemployment rate is the percentage of unemployed worker in the total labor
force. From the figure above shows that the unemployment rate of Japan maintains
between 2.2% to 2.5%. Low unemployment rate indicates that most of the labo force
in Japan are occupied. This will have to improve the economy of Japan because the
labor force that obtain wages will be able to do consumption and enhance the
economy of Japan.
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2.2.4 Inflation rate
Figure 3: Inflation rate of Japan from November 2018 to October 2019
Inflation is a situation where the price level of goods and services increased over a
period of time. The increase of price level will cause the purchasing power of
currency decrease and decrease the saving.
From the figure above, the inflation rate of Japan decreases gradually from October
2018 to February 2019 and it started increase to 0.9% in March 2019. It continues to
increase to 0.9% in April 2019 which is the highest among other months. The
inflation rate started to show the trend to decline from May 2019 until the October
2019 which is from 0.7% decreased to 0.2%.
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2.2.5 Japan Consumer Price Index
Figure 4: Consumer Price Index from October 2018 to October 2019
The Consumer Price Index or CPI is a measurement that used to examines the
weighted average price of a basket of goods and services that can be consume, such as
food, medical care and transportation. To calculate the CPI, the price changes for each
item in the predetermined basket of goods will be averaged.
According to the figure above, the CPI is showing an unstable trend where the CPI is
started at 101.8 index point at November 2018. The CPI decreased 0.3 index point at
101.5 index point at December 2019 at it maintain at that index point until March
2019. The CPI increased to 101.8 index point at April 2019 and decrease 0.2 index
point to 101.6 at June 2019. The CPI started to show an increasing trend at July 2019
from 101.6 to 102.2 index point at October 2019 which is the highest among other
periods.
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2.2.6 Japan Balance of Trading
Figure 5: Balance of Trade from October 2018 to October 2019
Figure 6: Imports of Japan
Figure 7: Exports of Japan
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Balance of trade is the difference between the number of country imports and exports
in a period of time. Balance of trade is mainly used to indicate the relative strength of
a country economy. A positive result would indicate as trade surplus while a negative
result would indicate as trade deficit.
Based on the figure above, it shows that Japan is having a trade surplus of JPY 17.3
billion at October 2019, despite the balance of trade is facing a deficit of JPY 124.817
billion from previous month. The import of Japan decreased 14.8% over a year
earlier, the sixth consecutive drop because the decrease of oil price and rise in sales
tax. Exports slumped 9.2 percent, falling for the eleventh straight month and by the
most in three years, amid a drop in shipments to China and the US.
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3.0 Industry Analysis
Industry analysis is a study of competitive dynamics of an industry. We can

understand a company position relative to other companies in the same industry by
studying company historical background. Thus, investors can make a comparison
among companies in the same industry. In this analysis, we would use SWOT
analysis to analyses a company in many perspectives. It helps us to identify a
company opportunities, threats and future prospects in the business environment.
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3.1.0 Heineken Malaysia Berhad
3.1.1 Business overview of Heineken
The company was founded in 1989 and located in Petalling Jaya, Malaysia.
Heineken Malaysia Berhad is one of the leading brewer in Malaysia. Heineken's
business is produce, packaging, marketing and distribution of beverages primarily in
Malaysia. There are several well known beers such as Tiger, Guinness, Strongbow
and Apple Fox. Other than beers, the company also have produce beverage which is
non-alcoholic Malta. The company listed in Main Market of Bursa Malaysia since
1965.
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3.1.2 SWOT analysis
The SWOT analysis is a technique used to determine a strengths, weaknesses,

opportunities, threats of a company. In this analysis, we would study each part on
Heineken Malaysia Berhad.
Strengths of Heineken
(i) Strong brand portfolio as Various brands of beer
The company is selling various brands of beer to consumers such as Heineken, Tiger,
Guinness and Apple Fox. Different brands of beer may have different flavour that
consumer can choose a beer based on the their preferences. This can enhance
recognition of brand name and Heineken company. And also, the company is able to
capture high market share in Malaysia by introducing various brands of beer to
consumers.
(ii) Successful track record
Heineken have consistent historical track record in financial statement. Revenue and
net profit is increasing in the historical 5 years. This shows that the demand for the
products of the company is always constant and increasing. After that, a good track
record shows that the business is not highly affected by economic performance of
Malaysia. Furthermore, the company is good at managing on controlling the costs and
expenses as the net profit is increased over the period.
Weaknesses of Heineken
(i) Weak management in financial planning
This can be proved by looking at 5 years historical record on liquidity ratios in graph
4. The current ratio and quick ratio is decreasing over the period. This means the
changes in amount of current of liabilities is greater than changes in current assets
thus resulting current ratio and quick ratio is decreasing in historical 5 years.
(ii) Introduction of SST in Malaysia
Government in Malaysia have abolished GST and changed to SST on September 1,

2018. It would result increasing in selling price of beer to consumers. Thus, it would
influence consumers spending and affect profitability of the company.
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Opportunities of Heineken
(i) Low Inflation Rate
Malaysia experienced low and stable inflation rate. This means changes of the prices
of beers is low over the period. Consumers is able to purchase it with a reasonable
price. Thus, it can guarantee the quantity of beer sold is at the constant rate and
profitability of the company also would be at the stable rate.
(ii) New Technology in Manufacturing Process
Industrial Revolution 4.0 which enable manufacturing process become automation in

the coming years. Hence, it could reduced reliance on labour in manufacturing
process. Cost of manufacturing would be reduced and also increase efficiency and
profitability of a company.
(iii) Opening up of new markets
Heineken has expanded its business operation into a new emerging market such as
Cambodia. It can increase new organic growth of the company by selling beverages
into new market which is Cambodia. Thus, company revenue and net profit would
increase in the coming year.
Threats of Heineken
(i) Illicit alcohol.
illicit alcohol is an alcohol that sold without approval from the authorities of
government and certification from ministry of health. Some consumers would shift to
illicit alcohol as the price of illicit alcohol is cheaper. Hence, It would harms to the
HEIM in term of market share and revenue.
(ii) Rising of raw material prices
Ingredient in producing a beer requires some natural ingredients which is water,

malted barley, hops and wheat. Changes in raw material prices would resulted
decrease in profitability of HEIM as the cost of goods sold increased that additional
cost is required to produce the same product.
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3.1.3 Competitor analysis (Carlsberg)
Carlsberg Brewery Malaysia Berhad is established in 1969 and the company is

one of the leading brewers in Malaysia. After that, Carlsberg Brewery Malaysia
Berhad is a competitor of Heineken that the company is selling the same beer with
different brand in Malaysia. Carlsberg is engaged in production, marketing, packaging
and distribution of beer. There are various brand of beer in Carlsberg which us
Carlsberg, Balnc, Asahi, Somersby, and so on. However, the types of beer is less than
Heineken.
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3.2.0 Dutch Lady Milk Industries Berhad
3.2.1 Business overview of Dutch Lady Milk
Dutch Lady Milk Industries Berhad is a Malaysia-based dairy company. The

Company operates through manufacturing and distributing a range of dairy products
segment. It offers specialized powders for infant and growing up children, liquid milk
in different packaging formats and yoghurts. Its products, which include Dutch Lady
Purefarm ultra-high-temperature processing (UHT) milk, Friso Gold and formulated
milk powder for children, Dutch Lady Nutriplan with 5X docosahexaenoic acid
(DHA), are distributed to Peninsular and East Malaysia. The Company markets its
products under various brand names, such as Dutch Lady, Dutch Baby, Frisolac, Friso
and Dutch Lady Purefarm. The Company's other products include Dutch Lady
Chocolate Drink Ezymix, Dutch Lady Family Milk Powder, Dutch Lady Low Fat
Yoghurt and Dutch Lady 0% Fat Yoghurt Drink.
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3.2.2 SWOT analysis
The SWOT analysis is a technique used to determine a strengths, weaknesses,

opportunities, threats of a company. In this analysis, we would study each part on
Dutch Lady Milk Industries Berhad.
Strengths of Dutch Lady Milk
i. Large market presence and strong reputation.

Dutch Lady Milk Industries Berhad ("Dutch Lady Malaysia") is market share
leader in the quality branded dairy business in Malaysia which holding 40% of
national milk market share. It was the first milk company in Malaysia to be listed
on Bursa Malaysiaand one of the largest milk companies in the world. The
Company's dairy products have a strong consumer loyalty and are represented by
strong brands such as Dutch Lady, Frisolac, Friso, Completa, Omela and Joy.
ii. Wide range of quality dairy products and fruit juices.
Dutch Lady Malaysia is leading in milk categories such as UHT milk,
Sterilised milk and Growing-Up Milk. Dutch Lady Malaysia is also the largest
purchaser of local fresh milk from the Veterinary Services Department.It
emphasizes taste, health, convenience and reliability.The product range consists of
consumer milk, milk in powder and concentrated form, dairy drinks, yoghurts,
desserts, cream, coffee creamers, baby and infant food, cheese, butter and
ingredients.
iii. Excellent sales staff with strong knowledge of existing products.
Dutch Lady Malaysia provides a working environment which full with
fairness, respect and comfortable to their employees. It was being number 1
employer in dairy industries Malaysia. It also provides paramount training and
development to their employees to sustainable success. Dutch Lady Malaysia
always ensures that their employees are continuously equipped with the necessary
skills and knowledge in the fields of human resources, marketing, sales, finance
and operations.
Weaknesses of Dutch Lady Milk
i. Lack of product awareness.

Due to Dutch Lady is the first producing UHT fresh milk in Malaysia, they
lack of awareness and experience in field of UTH milk. They don’t have more
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information for them to refer or consult. Since they are the first company to
launch out the UTH milk, Malaysian still don’t have the knowledge about UHT
milk. So they need to do more advertisement to develop product understanding or
send trained staff to direct explain to customer and lead to increase the cost and
price of sell.
ii. Price factors of Dutch Lady.
The price of Dutch Lady compares with other competitor such as Nestle,
Marigold, and Farm Fresh is quite high. Based on research, the price of Dutch
Lady fresh milk is RM 7.49 but Farm Fresh’s fresh milk is only RM 6.90 and
Marigold is only RM 5.29. Because of in Malaysia, most of families are middle
income and they will prefer the cheaper product. Due to the profit of Dutch Lady
will decrease.
iii. No direct market experiences.
Dutch Lady has only sold in hypermarket, grocery store, supermarket, and also
convenience shop. Therefore Dutch Lady no have direct market experience since
Dutch Lady no supply to end-user abroad. Direct market can improve relationship
between consumer and supplier and also can get more information direct form
consumers while improve the product quality or satisfy customers need and want.
Dutch Lady also doesn’t have feedback section in the website so that Dutch Lady
cannot get feedback from consumer at least Dutch Lady sends trained staff to
promote the product and get the feedback and this will due to increase the cost.
Opportunities of Dutch Lady Milk
i. Lack of the substitution of milk powder.

Milk powder plays a crucial role in our daily life. It is a source of vitamins and
minerals such as magnesium, calcium, zinc, potassium and phosphorus. For the
babies among between the ages of four to six months and two years, they need
these nutrients from milk powder which is liquid form food. There are no more
choices of liquid form food for parent to choose for their baby. So, milk powder
will be the only choice and no more substitution for parent.
ii. Tremendous potential customers in market.
Not only baby need to drink milk powder, pregnant females and senior
citizens, even adult male also need to get nutrients from milk. Undeniably,
everyone can get a lot of nutrient from milk for their teeth and bone health. Public
35
awareness of dairy products can help to attract new customers group and develop
different type of dairy products based on customer ages and need.
iii. Expansion business to other countries.
Since Dutch Lady Malaysia is the largest dairy company in Malaysia, it was
reach market saturation in Malaysia. Dutch Lady Malaysia should target to expand
their business to other countries in order to become market share leader. Dutch
Lady Malaysia must show good product image to the public in order to get more
market acceptance from the local people. This will help Dutch Lady Malaysia in
their expansion business to other countries.
Threats of Dutch Lady Milk
i. Increasing cost of raw materials.

Dutch Lady Malaysia Managing Director, Rahul Colaco said that the price of
raw materials of its product has risen between 25% and 30% in the last year due to
increased demand from China. New Zealand, one of the world’s main producers
of milk products worsen the situation which will make the prices of formulated
powder for children and family milk beverage to slightly increase by 5%.
ii. Price of transportation increase.
Lately, Malaysia government has cut the subsidies for the RON95 petrol and
diesel by 20 Sen per litre from October 2, 2014. The retail price of RON97 petrol
is RM 2.30 per litre and the price for diesel is RM 2.20 per litre. The increase of
this subject causes the price of transportation to increase because transportation
needs fuel to operate.
iii. Unexpected Problems.
Recently, there has been an issue about Cadbury Dairy Milk which contains
Porcine DNA. This crisis causes consumers in Malaysia to be scared of buying
product from Cadbury Dairy Milk because the majority of Malaysian citizens are
mostly Muslims. The issue about porcine DNA founded in Cadbury Dairy Milk
Chocolate made the consumer in Malaysia to be aware of every dairy milk
product in Malaysia. The awareness of the consumers also affects the sales of
Dutch Lady because the consumer doubts that Dutch Lady’s product might
contain porcine DNA too.
36
3.2.3 competitor analysis FRASER & NEAVE (F&N)
Fraser & Neave Holdings Bhd is an investment holding company. The

Company, through its subsidiaries, is engaged in the manufacture and sale of
beverages, dairy products, property development activities and the provision of
management services. The Company's segments are Food and Beverages Malaysia,
Food and Beverages Thailand, Property and Others. The Company's beverage brands
include 100PLUS, F&N Fun Flavours, F&N Fruit Tree, F&N SEASONS, F&N
NutriSoy, F&N ICE MOUNTAIN, OYOSHI and Ranger. The Company's dairy
brands include F&N Magnolia, FARMHOUSE, Ideal, TEAPOT, Sunkist, GOLD
COIN, Cap Junjung and Carnation. The Company exports its products to over 70
countries around the world, which includes China, Hong Kong, Taiwan, Singapore,
Philippines, Indonesia, the Middle East and Africa. Its subsidiaries include F&N
Beverages Marketing Sdn Bhd, F&N Dairies Manufacturing Sdn Bhd, F&N
Beverages Manufacturing Sdn Bhd and Fraser & Neave (Malaya) Sdn Bhd.
37
3.3.0 Top Glove Corporation Berhad
3.3.1 Business overview of Top Glove
The company was founded in Malaysia in 1991 and has emerged as the world's
largest manufacturer of gloves, commanding 26% of the world market share. Top
Glove was a rubber glove manufacturer and offered its products in three types of
materials, such as latex, nitrile and vinyl. The products produced include latex
powdered gloves, latex powder-free gloves, soft nitrile powdered/powder-free gloves,
nitrile gloves, stretchy vinyl powder-free gloves, surgical gloves, household gloves,
cleanroom gloves, cast polyethylene (CPE) gloves, industrial/long length high risk
gloves, thermoplastic elastomer gloves, nitrile surgical gloves, double donning
surgical gloves and thermoformed film packaged surgical gloves. Top Glove was
listed on the Bursa Malaysia in 2001.
38
3.3.2 SWOT analysis
The SWOT analysis is a technique used to determine strengths, weaknesses,

opportunities, threats of a company. In this analysis, we would study each part on Top
Glove Corporation Berhad.
Strengths of Top Glove
(i) Global market leader
Top Glove was the largest rubber gloves manufacturer in the world. The company
benefited from gaining economics of scales by produced in huge capacity through 682
production lines. The company has captured 26% of the world market share currently
and offered a comprehensive product range, fulfilling demand in both the healthcare
and non-healthcare segment. Top Glove aspires to increase its global market share to
30% by 2020 and become a Fortune Global 500 company by 2040. Top Glove is also
aggressively expanding its business scope and on the lookout for M&A opportunities
in similar and related industries.
(ii) Wide product range
Top Glove has 14 ranges of productions from examination to industrial usage and
from latex to synthetic gloves. These include latex powdered gloves, latex powder-
free gloves, soft nitrile powdered/powder-free gloves, nitrile gloves, stretchy vinyl
powder-free gloves, surgical gloves, household gloves, cleanroom gloves, cast
polyethylene (CPE) gloves, industrial/long length high risk gloves, thermoplastic
elastomer gloves, nitrile surgical gloves, double donning surgical gloves and
thermoformed film packaged surgical gloves.
Weaknesses of Top Glove
(i) Not environmentally friendly product
The products produced by Top Glove are mainly in rubber which is not
environmentally friendly product. Rubber is a non-renewable resource and it cannot
be reuse and recycle. Rubber is widely use in the health and medical field. These
gloves cannot be reuse again due to the sanitation condition. It will cause pollution
indirectly if did not address these gloves properly.
39
Opportunities of Top Glove
(i) Growth in the environmentally friendly product industry
Top Glove had recently launched its biodegradable nitrile gloves (powder-free) in
conjunction with World Environment Day. This launch was a significant milestone
for Top Glove in terms of integrating sustainability into its business strategy, given
the growing environmental awareness and demand for environmentally friendly
product. Top Glove are providing their increasingly discerning and diverse customers
with a high-quality option which will leave minimal environmental footprint.
Threats of Top Glove
(i) Increase in latex price
Latex is the main material in producing gloves. The price of one kilogram of latex is
RM 4.26 in October 2019. The increased in the latex will raised the manufacture
costs. However, most of the manufacture costs can be passed on to the customers.
40
3.3.3 Competitor analysis
(i) Hartalega Holdings Berhad
Hartalega Holdings Berhad is engaged in the manufacture and sale of latex gloves.
The company also offered Nitrile gloves and Original Equipment Manufacturer
(OEM) gloves. Hartalega is a competitor of Top Glove that the company is also
selling latex gloves and nitrile gloves such as Latex Powdered 4.0 Mil, Latex Powder
Free 4.5 Mil, Latex Powder Free 5.0 Mil, Latex Polymer Coated 5.5 Mil, COATS
Latex Powder Free 4.5 Mil, Latex Polymer Coated 9.0 Mil Extended Cuff, Nitrile
Powder Free 2.7 Mil, Nitrile Powder Free 3.2 Mil, Nitrile Powder Free 3.5 Mil,
Nitrile Powder Free 3.5 Mil Extended Cuff, Nitrile Cleanroom 3.5 Mil Extended Cuff,
COATS Nitrile Powder Free 3 Mil, Nitrile Cleanroom 4.5 Mil Extended Cuff and
Nitrile Powder Free 8.0 Mil Extended Cuff.
(ii) Kossan Rubber Industrial Berhad
Kossan Rubber Industrial Berhad is a Malaysia-based company engaged in

investment holding, manufacturing and sales of rubber products and provision of
management services to subsidiaries. The company operated through four segments
which are technical rubber products, gloves, cleanroom products and others. Kossan is
also a competitor of Top Glove.
41
3.4.0 McDonald’s Corporation
3.4.1 Business overview of McDonald’s Corporation
McDonald's Corporation is an American fast food company, founded in 1940 as a

restaurant operated by Richard and Maurice McDonald, in San Bernardino,
California, United States. McDonald's is the second-largest fast food restaurant chain
by number of locations in the world. McDonald's restaurants are found in 120
countries and territories around the world and serve 68 million customers each day.
McDonald's is the world's largest restaurant chain by revenue, serving over 69 million
customers daily in over 100 countries across 37,855 outlets as of 2018. Although
McDonald's is best known for its hamburgers, cheeseburgers and french fries, they
also feature chicken products, breakfast items, soft drinks, milkshakes, wraps, and
desserts. In response to changing consumer tastes and a negative backlash because of
the unhealthiness of their food, the company has added to its menu salads, fish,
smoothies, and fruit.
42
3.4.2 SWOT analysis
The SWOT analysis is a technique used to determine the strengths,

weaknesses, opportunities, threats of a company. In this analysis, we would study
each part on McDonald's Corporation.
Strengths of McDonald's Corporation
(i) The second-largest restaurant network serving customers in over 120

countries.
As of 2018, McDonald’s operates the second-largest restaurant network in
the world. In total, the company and its franchisees operate 37,241
restaurants in 120 countries.
Figure 1: Largest quick service restaurant (QSR) chains by number of locations in

2018
Rank Brand Name Locations

1 Subway 43,772
2 McDonald’s 37,241
3 Starbucks 27,339
4 KFC 21,487
Source: The respective Companies’ financial reports and official websites
(ii) Economies of scale

The company can share its fixed costs over many restaurants’ locations,
which makes McDonald’s one of the cheapest places to eat at.
(iii) Huge gains from implementing best practices.
The company can identify better ways of performing tasks, managing
restaurants or hiring new employees and can achieve huge gains by
implementing these best practices in its vast network of restaurants.
McDonald's has successfully rolled out new items like coffees, smoothies,
and Angus burgers, expanding the range of menu choices.
(iv) Market power over suppliers and competitors.
Due to its size, McDonald’s can exercise its market power over suppliers
by requiring lower prices from them. The company clearly demonstrates
this with The Coca Cola Company. Because of McDonald’s and The Coca
43
Cola Company’s agreement, no other restaurant chain can sell Coca Cola
drinks for lower prices than McDonald’s, even if it means losing the
business to PepsiCo. The Coca Cola Company could easily get out of such
agreement if McDonald’s wouldn’t be so huge and would generate less
income for The Coca Cola Company. McDonald’s can also use its size to
affect the competition by under-pricing some of its items or driving them
out of the best locations.
(v) Wide audience reaches.
McDonald’s restaurant network allows the chain to reach more customers
than most of its rivals could reach. According to the Company’s CEO, in
five of its largest markets, 75% of population lives within 3 miles of
McDonald’s restaurants. Wide audience reach does not only help the
company to target more customers and increase brand awareness, but also
to introduce new services, such as home delivery. Operations are spread
around the world, meaning the company is not exposed to just one
currency or economy.
(vi) With a strong product offering, the company has grown income throughout
the recession, notching strong increases in same-store sales.
(vii) Tasty Food
McDonald’s French fries are considered the best tasting fries in the fast
food industry.
44
Figure 2: Percentage of Americans saying the following make the best
burger/fried
Source: Statista
(viii) The most recognizable brand in restaurant industry

According to Forbes and Interbrand, McDonald’s brand is 9th and 12th
most valuable brand in the world, worth US$40.3 billion and US$41.533
billion, respectively. No other restaurant brand, except Starbucks, is
included in the list of the top 50 most valuable brands. The brand value is
closely related to the brand recognition and reputation. Usually, the more
valuable a brand is the better it is recognized worldwide. McDonald’s,
which operates in 120 countries, where billions of people live, enjoys
some of the greatest brand awareness among all global corporations. Only
KFC operates in more countries (131) than McDonald’s and can compare
in brand awareness with it. Brand awareness also helps to introduce new
products or sell the current ones faster as the company needs to spend less
money on advertising. While, McDonald’s reputation has suffered a lot
during the years, the company is still recognized for its innovations in fast-
45
food industry and the American business values it brings to other
countries.
(ix) Highest Brand Value in Fast Food Brands
McDonald’s enjoys the privilege of being the most valuable fast food
brand in the world with the brand value of $126.04 billion in 2018. No
other brand, in the fast food category, was even close to McDonald’s
worth as Starbucks, which was the second most valued brand had a worth
of just $44.5 billion.
Weaknesses of McDonald’s Corporation
(i) It will be harder and harder to find prime locations to build a set of golden
arches. The U.S. is saturated with its restaurants, so growth will have to
occur internationally, posing potential cultural challenges.
(ii) While the annual dividend hikes are likely to continue, the dividend
growth rate has been slowing and will probably continue to slow or level
off.
(iii) The Franchise business model
McDonald’s is the best example of international franchising models.
However, having this complicated web of franchised and company-
operated restaurants expose the brand to certain risks. The risks of
financial deterioration, mismanagement, customer dissatisfaction, and low
revenue generation. The company heavily depends on the franchises which
works independently and hence they have no control over their day to day
performance, but it affects the brand directly.
(iv) Lack of Employee Satisfaction
Due to recent employee right revolutions worldwide and increased wage
limits, many organizations have faced critical dissatisfaction from
employees. Recently McDonald’s has faced extreme backlash from their
workforce. The workers went to several protests and strikes with a demand
to increase their minimum wage to $15 an hour, causing the company
reputational harm.
(v) CEO got fired
46
In Nov 2019, McDonald’s CEO, Steve Easterbrook, was fired after having
a consensual relationship with an employee. It violated company policy.
The company’s board stated that Steve had “demonstrated poor judgment.”
Opportunities of McDonald’s Corporation
(i) There are opportunities for new restaurants outside the United States, and
McDonald's has been taking advantage of them. China is a great
opportunity for the company, as is much of Asia.
(ii) Menu innovations are limited only by imagination.
McDonald’s must put efforts to introduce new, innovative items on their
menu to make customers choose them instead of the new fast food outlets.
In 2018, the company started to serve an exclusive beverage – MIX by
Sprite Tropic Berry in their New York outlets. It became an instant hit and
is likely to be served in all of the US. Launching more items like this
according to the geographical conditions and culture can help McDonald’s
maintain their charm for a longer period of time.
(iii) Low interest rates provide cheap capital for growth. In addition to dollar-
denominated debt, McDonald's recently became the first foreign company
to issue yuan-denominated bonds in Hong Kong.
(iv) Global expansion
McDonald’s rules over the US, but it is often that it struggles in the
international market. However, the company has high potential to continue
its global expansion by focusing more on international markets rather than
different states of America.
(v) Rebuilding the brand image
While fast-food restaurants are struggling to fight the image of ‘junk
producing centers’, McDonald’s can play it smartly by continuing its
aggressive initiatives towards, healthy and customized offerings. These
developments have begun to show progress, with positive comparable
sales leading to a growth in profits. The re- franchising mission have
surely pushed the sales back, but in the long run, the healthy image of
McDonald’s can continue to make bigger differences.
(vi) Mobile order and McDelivery
47
McDonalds has initiated a partnership with UberEats and Door dash for
US food delivery. These mobile order and delivery initiatives help
McDonald’s to reach and fulfil customer’s ever-changing needs.
48
Threats of McDonald’s Corporation
(i) Governments are considering regulations targeting fast food.

(ii) McDonald's faces competition from strong peers such as recent 11
O'Clock Stock pick Yum! Brands and Burger King.
(iii) New age fast food trends
McDonald’s often for millennial is considered an old school with its
traditional menu and taste. In this situation, food chains like shake shack
and Wendy’s take full advantage with their often-experimented menu and
recipes to include variety. For example, McDonald’s failed to compete
with Wendy’s “Signature-Crafted Burgers.” and hence had to stick with its
conventional Quarter Pounders to save face.
(iv) Commodity price increases could increase costs while a weak economy
limits the ability to pass the price hikes through to consumers.
(v) Risky investments on technology initiatives
Although the innovative changes done by McDonald’s have a positive
outlook, the investment in technology is still risky. The public pace of
adapting new technologies may slow down the return on investment, and
the results of enhancing customer experience may not generate the
expected returns.
(vi) Constant environmental concerns
Like every other food giant, McDonald’s face immense pressure to
improve its practices to minimize the waste, which causes environmental
pollution. The growing ecological concerns demand McDonald’s to take
initiatives in this regard and set an example for other food outlets but it is
not that simple. In March 2018, environmental activists proposed the board
of directors of McDonald’s to abandon the use of plastic straws in its over
37,000 restaurants worldwide due to explosion of plastic pollution.
49
3.4.3 Competitor analysis (Burger King)
Burger King (BK) is an American multinational chain of hamburger fast food

restaurants. After that, Burger King is a competitor of McDonald Corporation that the
company is selling the same burger with different brand. Burger King's menu has
expanded from a basic offering of burgers, French fries, sodas, and milkshakes to a
larger and more diverse set of products. The new product line significantly expanded
the breadth of the BK menu with many non-hamburger sandwiches, including new
chicken and fish offerings. However, the types of new product are less in McDonald’s
Corporation.
50
3.5.0 Panasonic Corporation
3.5.1 Business Overview
Panasonic Corporation is a Japan based multinational electronics corporation that

located at Kadoma, Osaka, Japan. The corporation operations are organized into three
broad business fields which are consumer, solution and components & devices.
Panasonic Corporation also comprises to various business domain companies from
Audio Visual to home application, to industrial solution and other consumer
electronic products. Panasonic Corporation also distribute it nosiness into seven
domain companies which are: appliances company, life solution company, connected
solution company, China and Northeast Asia company and US company. Each
company has it distinct research and development, production and sales function in
order to satisfy the specific consumer needs worldwide. Panasonic was founded in the
year of 1918 and now its own capital stock that value to 258.7 billion yen with 271,
869 number of employees work under the corporation. The number of consolidated
companies amounted to 582 companies and the net sales generated was 8,002.7
billion yen in year 2018.
51
3.5.2 SWOT Analysis
SWOT analysis is a strategic planning technique that used to help a person or an

organization to determine the strength, weakness, opportunities and threats related to
business competition or project planning.
Strengths of Panasonic Corporation
Strengths is defined as the characteristic of the business and project that give it an
advantage over others. It also defined as what an organization excel at and what
separate it from its competition.
i. Wide Presence
A mass brand with a massive presence and distribution across multiple continents and
multiple regions is one of the factors that contribute to Panasonic Corporation
success. It is present in well over 100 countries and the revenue is divided among
Japan, Asia, USA and Europe.
ii. Performance Consistency
The brand is loved because of its consistency of performance over time. The quality
of the product is guarantee to be good. Japanese manufacturing is always known for
its good quality. Moreover, Panasonic has been a firm which has consistently given
good quality of products since its inception.
iii. Adaptable to the market
The company does not stick to one product and it always kept bringing in more
renovate products from time to time. It has removed products from its inventory
which did not carry weightage anymore. As a result, the product line is pruned and
maintained.
iv. Product portfolio & Product quality
The product portfolio of Panasonic is huge. It involves in Eco Solutions, Appliances,

Industrial products, Communications, Automotive, Energy, Healthcare and
Manufacturing and the best part is that Panasonic is a known and trusted brand in all
these segments and has a healthy revenue share in these segments.
v. Strong Marketing communications
52
The marketing of Panasonic is known to be strong. Panasonic frequently uses brand
ambassadors which carry a message for its brand. Also, the brand does not only target
marketing of its normal and regular products, it also targets marketing of
differentiated products such as the cube air conditioner. Along with these
differentiated products, it also targets the mass market with regular advertising.
Weakness of Panasonic Corporation
Weakness is defined as the characteristic of business that place the business or project
at disadvantage relative to other. Weakness would stop an organization to perform at
its optimum level. Those area need to be improved to achieve g business goals.
i. No Cash cow
Panasonic does not have any cash cows even though it is the star of the BCG matrix
in almost every sector. There is no product which is a cash cow for Panasonic. This is
possibly because all the products are targeting segments which have a huge number of
competitors and hence market share is always under challenge.
ii. Focus becomes an issue
It hard for Panasonic to focus because there are too many products. Panasonic has
been known to have internal management problems. At the same time, handling 3.3
lakh of people and managing such a large company with such variety of products
become overbearing for them.
iii. Bottomline erodes due to competition
Because the constant presence of competition, the bottom line erodes and there are
continuous price wars in the market to capture a higher market share.
Opportunities of Panasonic Corporation
Opportunities refer to the elements in the environment that the business or project
could exploit to its advantage. These will give the business or project external factor
to improve the business or project.
53
i. Developing economies
Conquer developing economies in Asia or even other continents would be Panasonic

best opportunities because Panasonic has too much exposure to Japan only and it
needs to spread its activities across as many nations as possible.
ii. Marketing
Many recent brands have shown that investments in marketing and brand building
actually gives dividends for the brand. Although Panasonic markets smarter, it does
not market as heavily as a mass brand should and therefore its investment in
marketing activities need to go up.
iii. Creating differentiated products / Innovations
Differentiates and innovations give a first mover advantage to the brand creating such
innovation. Samsung with its various smartphones and smart tv’s has shown the
power of differentiation. Panasonic needs to focus more on creating differentiation
faster instead of being a follower in the same.
iv. Building better customer service
Be it any segment, if the customer service is top notch, then the brand and the
company develop faster and it also has higher customer retention numbers. Panasonic
is known to have customer service issues and thus focusing on customer service
problems will be a better move for the brand.
Threats of Panasonic Corporation
Threats refer to the elements in the environment that could cause troubles for the
business or project. These troubles could potentially harm the business.
i. Competition from China
While Japan manufacturers quality, China manufactures for the masses. As a result,
the competition from China is huge for the Japanese company. There are more and
more products coming up from China thereby making a dent in Japanese market
share. Japanese products will always be costlier but lately, even Chinese products are
performing better and have good quality. Naturally, Japanese brands will suffer due to
the low price and penetrative margin products of China.
54
ii. Dependence on technology
This segment is totally dominated by technology and if one technology gets outdated,
the other one needs to be caught up fast. On the other hand, if one brand creates a new
technology, then the other brands have 6 months to follow up with the same or they
will lose heavy market share. Thus, this dependence of technology is a constant
challenge for Panasonic.
iii. Market competition
There is omnipresent market competition in the sectors in which Panasonic operates,

thereby the market share is always under threat of conquer.
iv. Government regulations
Changing energy norms of air conditioners are a perfect example of Government

regulations taking effect on operations. The government regularly changes energy
norms for air conditioners and the star ratings get affected and the company’s
manufacturing them have to change their complete line of products. The same can
happen across the many products of Panasonic.
55
3.5.3 Competitor Analysis
Samsung
Samsung is a giant in the electronics industry in the world. Samsung always stands
out from the rest of the industry with its new innovation. Samsung is a company based
in South Korea and it was founded in 1938 and it has continued to produce excellent
product over the years and it always setting a new standard to each new product
release.
The company has a with range of products which are electronic components,
semiconductors, home appliances, consumer electronics and telecommunications
equipment among many others. In 2014, the company had assets worth 529.5 billion
dollars with revenue more than 300 billion dollars and it had over 489,000 employees
serving all around the world. With its wide product portfolio, presence in smartphones
and consumer electronics, Samsung is one of the top competitors for Panasonic.
LG
LG is one of the major players in electronic industry that cannot be underestimated

because it operates in more than 80 countries. Some of the subsidiaries that are
operated under LG banner are LG Display, LG Chem, LG Electronics and LG Uplus
among several others.
LG mainly deals with Chemicals, Telecommunication Equipment, and electronics.

LG was founded in 1947 and has developed and grown into a manufacturer with a
with variety of products that are revolutionary to the industry. In 2012, LG has
approximately 222,000 employees serving in its location worldwide and LG was also
able to generate 143 billion dollars of revenue in the same periods. True to it ‘Life’s
Good’ slogan, LG definitely make it customers life easier. Hence, LG is one of
Panasonic competitors.
Haier
Haier is a China based multinational company that deals with the production of home
appliances and consumer electronics. It has wide range of products include
computers, mobile phones, televisions, microwave ovens, air conditioners,
refrigerators and washing machines.
56
The company was founded in 1984 and its headquarters is located at Qingdao, China.
Haier Electronics Group, Qingdao Haier, Hotpoint America and Fisher & Paykel are
some of Haier’s subsidiaries. In 2016, Haier had almost 78,000 employees that
contribute 29 billion dollars revenue and a net income of 2.94 billion dollars.
57
4.0 Fundamental Analysis
Fundamental analysis is a technique used in evaluating the financial condition of

a company and operating results in the historical period. In fundamental analysis, we
can examine a management of company and efficiency of a company by studying
various financial ratios.
58
4.1.0 Heineken Malaysia Berhad
4.1.1 Financial Ratios of Heineken
Heineken Malaysia Berhad have changed its annual report date from June to
December of the year in 2016. Thus, the financial statement of Heineken in 2016 is
consisted with 18 months and resulted higher value in the financial statement.
The financial information is obtained from terminal bloomberg which is located

in the first floor of Sultanah Bahiyah Library, UUM and i3Investor Website.
Income Statement (RM 'million)

2500
2000
1500
RM 'million
1000
500
0
2014 2015 2016 2017 2018
Graph 1:Income Statement from 2014 to 2018
Total revenue for HEIM from 2014 to 2018 is increasing. This is a good indicator
that the demand for the products from customers is increasing in Malaysia. Gross
profit is the profit remaining after deducting with cost of sales. Based on the graph,
the gross profit is increasing over the period.
Furthermore, operating income and net income in 2018 is the highest within 5
years. This implies the financial performance of company is improved and costs or
expenses is controlling well.
59
Balance Sheet
1000
900
800
700
600
RM'million
500
400
300
200
100
0
2014 2015 2016 2017 2018
Graph 2: Balance Sheet from 2014 to 2018
Based on the graph, total assets and total liabilities for Heineken shows the
increasing in value from 2014 to 2018 which is RM940.3 million, RM569.2 million
and RM 371.1 million. In brief, the business of company is expanding from year over
the year that shown in the value of total assets as the company owned more assets for
business operation. Meanwhile, amount of total equity is at the range around
RM356.8 million to RM 371.1 million.
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Cash from
Operating Activities
(RM' million)
400
350
300
250
RM ' million
200
150
100
50
0
2014 2015 2016 2017 2018
Graph 3: Cash from Operating Activities from 2014 to 2018
Based on the graph above, cash flow from operation activities is increasing over
the period and the value is always in positive value. This implies that the cash
generated is greater than expenses that used in business operation. This is a good
indicator as the company is able to distribute more dividends to shareholders with its
available cash in the company.
61
Liquidity Ratio (times)
2
1.8
1.6
1.4
1.2
0.8
0.6
0.4
0.2
0
2014 2015 2016 2017 2018
Graph 4 : Liquidity Ratio from 2014 to 2018
The current ratio is an important liquidity ratio. In this ratio, we can see the
ability of the firm to pay back current liabilities with its current assets. After that,
quick ratio is similar to current ratio. quick ratio is a measurement that measure firm's
ability to pay back current liabilities with its current assets without including
inventories. Both ratios are decreasing over the period, but the current ratio is always
greater than zero that amount of current asset is always greater than total amount of
current liabilities. Hence, the company has no problem in paying its current obligation
on time.
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Activity Ratio (Days)
60
50
40
30
20
10
0
2014 2015 2016 2017 2018
Graph 5:Activity Ratio from 2014 to 2018
Inventory Turnover is a ratio that measure the times a company has sold and
replaced inventory during a given period. From 2014 to 2018, inventory turnover is
decreasing. This implies company used less time to sold and replaced back inventory
except for 2016, which inventory turnover is consisted of 18 months as a result of
changes in annual report date.
account receivable turnover measures the period that company used in collecting
its debt from customers. From 2014 t0 2018, the inventory turnover is decreasing to
4.16 days. the ratio is lower shows that the company is effective in collecting its
receivable from customers.
63
Leverage Ratio (%)
45
40
35
30
25
20
15
10
0
2014 2015 2016 2017 2018
Graph 6: Leverage Ratio from 2014 to 2018
The debt to equity ratio is a ratio that measure percentage of debt in using to
finance company's assets relative to the amount of equity in the company. From 2014
to 2016, debt to equity ratio is decreasing and in 2018 the ratio is increased to 28.29
per cent. Overall, the debt to equity is low as equity stands for large percentage in
HEIM. This shows that, default risk of interest payment on borrowing is low and also
risk of bankruptcy is low.
64
Profitability Ratio (%)
90.00%
80.00%
70.00%
60.00%
50.00%
40.00%
30.00%
20.00%
10.00%
0.00%
2014 2015 2016 2017 2018
Graph 7: Profitability Ratio from 2014 to 2018
Return on Asset (ROA) is a financial ratio used to measure percentage of net

profit to company's total assets. From 2014 to 2018, ROA ratio is at average above
30% means that the company generated income is stand for 30 per cent of the total
assets.
Return on Equity (ROE) is a ratio that used to measure net income earned by
company equity. ROE from 2014 to 2017 is increasing. The higher the ROE, the
better for the company that the company is good in utilizing money in equity to
generate more revenue and net profit.
Net profit margin is a percentage that showing the money after deducting all of
the expenses with company group revenue. The higher the net profit, the better for the
company. From 2014 to 2017, net profit margin is always above 10%. this indicates
that the company is efficient in controlling expenses and selling the product at the
reasonable price that can increase net profit for the company
65
Common Stock Ratio
160
140
120
100
80
60
40
20
0
2014 2015 2016 2017 2018
Graph 8: Common Stock Ratio from 2014 to 2018
Earning per share (EPS) is a net profit owned by each share outstanding in the
company. EPS of Heineken is increasing over the period from 2014 to 2018 except
2016 that financial statement in 2016 is involved 18 months resulted higher value of
EPS. Increasing in EPS shows that each share in Heineken is more valuable.
Dividend per share (DPS) is a dividend received by each share outstanding in the
company. DPS of Heineken is increasing over the period from 2014 to 2018. This is a
good indicator to the company and shareholders as can be proved that the company
have the ability to pay higher and stable dividend to shareholders of Heineken over
the period.
Dividend yield is calculated by using dividend per share divided by share price of
the company. Dividend yield in HEIM is decreasing from 2014 to 2018 as the share
price of Heineken is increasing over the period. Thus, higher share price result the
dividend yield decreased. However, the HEIM dividend yield is higher than fixed
deposit which is above 4% from 2014 to 2018.
66
4.1.2 Intrinsic Value of Heineken Malaysia Berhad
Information 2018 2019 2020

2016 2017
(Estimated) (Estimated) (Estimated)
Revenue
Q1 (RM’000) 458914 401114
Q2 (RM’000) 459512 406577
Q3 (RM’000) 384816 509588
Q4 (RM’000) 577519 612685
2106652.20 2299516.21
Total Sales 1880761 1929964 2510036.923
4 3
QoQ
Peformance
Q1 (%) -44.02 -53.22 -47.93
Q2 (%) 19.72 25.74 12.6
Q3 (%) -6.5 6.96 43.66
Q4 (%) 83.9 42.16 26.79
Average
QoQ 9.155
Performance
Net Profit
Margin
Q1 (%) 11.24
Q2 (%) 13.02
Q3 (%) 15.4
Q4 (%) 15.1
Total NP
13.69
Margin (%)
Estimated 288400.686 314803.769
343624.0547
Net Profit 8 6
EPS (Latest
0.2175
4Q) - Sen
Net Profit
(Latest 4Q) 65696
(RM '000)
NOSH 302050.574
67
7
Estimated 0.95480926 1.04222205
1.13763748
EPS (RM) 3 1
Current Share
Price (as at
25.3
November 10,
2019)
26.4974387
P/E
8
Target Share
25.30 27.62 30.14
Price (RM)
To calculate intrinsic value of Heineken Malaysia Berhad, some information is

required such as revenue, quarter over quarter performance, net profit margin, current
share price, latest net profit, and latest EPS. These information is obtained from
www.i3investor.com
The intrinsic value is calculated based on forecasting futures sales and profits.
After that, we need to calculate future EPS by using forecast profit divided by number
of share outstanding to forecast future stock price in the next two years which is 2019
and 2020 by multiplying forecast EPS with current P/E ratio. The final intrinsic value
of HEIM is RM 27.62 and RM 30.14 in 2019 and 2020.
The current share price of HEIM is RM25.30 as at November 10, 2019. Thus, the
current share price is undervalued as the price is lower than target price in 2019 and
2020 which is RM 27.62 and RM 30.14.
68
4.2.1 Financial Ratios of Dutch Lady Milk Industries Berhad
Income Statement (RM' million)

1,200.00
1,000.00
800.00
RM'million
600.00
400.00
200.00
0.00
2014 2015 2016 2017 2018
Graph 1: Income Statement from 2014 to 2018
Total revenue for Dutch Lady Milk from 2014 to 2017 is increasing but for
year 2018 it decrease to 1,048.57. As average this is a good indicator that the demand
for the products from customer is increasing in Malaysia. Gross profit is the profit
remaining after deducting with cost of sales. Based on the graph, the gross profit is
increasing over the period but it decrease in year 2017 and continue increase in year
2018. During this 5 years it shows that operating income and net income is increasing
but only decrease in year 2017 but continue increase in 2018.
69
Balance Sheet
600.00
500.00
400.00
RM'million
300.00
200.00
100.00
0.00
2014 2015 2016 2017 2018
Based on the graph, total assets and total liabilities for Dutch Lady Milk shows
the increasing in value from 2014 to 2018 which is 404.80 million and 299.34 million
respectively. In brief, the business of the company is expanding from year over the
year that shown in the value of total assets as the company owned more assets for
business operating. Meanwhile, the amount of the total equity is at the range around
104.01 million to 165.49 million during year 2014 to 2018.
70
Cash from Operating Activities (RM'million)
250.00
200.00
150.00
RM'million
100.00
50.00
0.00
2014 2015 2016 2017 2018
Based on the graph above, cash flow from operating activities is increasing for
the first 3year which is 2014, 2015 and 2016. While it dercease to 43.09 million in
2017. For year 2018 it increase to 120.45 million. This implies that the cash generated
is greater than expenses that used in business operating. This is good indicator as the
company is able to distribute more dividends to shareholders.
71
Liquidity Ratio (times)
1.60
1.40
1.20
1.00
0.80
0.60
0.40
0.20
0.00
2014 2015 2016 2017 2018
Graph 4: Liquidity Ratio from 2014 to 2018
quick ratio is similar to current ratio. quick ratio is a measurement that measure firm's
inventories. Both ratios are decreasing over the period, but the current ratio is always
on time.
72
30.00
25.00
20.00
15.00
10.00
5.00
0.00
2014 2015 2016 2017 2018
Graph 5: Activity Ratio from 2014 to 2018
Inventory turnover is a ratio that measure the times a company has sold and
replaced inventory during given period. From 2014 to 2018, generally the inventory
turnover is decreasing. This implies that company used less time to sold and replaced
back inventory, which inventory turnover is consisted of 18 months as a result of
changes in annual report date. For account receivable turnover measures the period
that company used in collecting its debt from customers. From 2014 to 2018, the
inventory turnover is decreasing to 9.33 days. the ratio is lower shows that the
company is effective in collecting its receivable from customers.
73
Leverage Ratio (%)
0.16
0.14
0.12
0.10
0.08
0.06
0.04
0.02
0.00
2014 2015 2016 2017 2018
to 2017, debt to equity ratio is 0 and for year 2018 the ratio is 0.14 per cent. Overall,
the debt to equity is low or almost 0. This means the equity stands for large
percentage in Dutch Lady Milk. This shows that, default risk of interest payment on
borrowing is low and also risk of bankruptcy is low.
74
Profitability Ratio (%)
40.00
35.00
30.00
25.00
20.00
15.00
10.00
5.00
0.00
2014 2015 2016 2017 2018

profit to company's total assets. From 2014 to 2018, ROA ratio is at about 30% means
that the company generated income is stand for about 30 per cent of the total assets.
company equity. ROE from 2014 to 2017 is increasing. The higher the ROE, the
better for the company that the company is good in utilizing money in equity to
generate more revenue and net profit.
Net profit margin is a percentage that showing the money after deducting all of
the expenses with company group revenue. The higher the net profit, the better for the
company. For the first 3 years which is 2014 to 2016 the net profit margin is
increasing but decrease in 2017, after that continue increase in year 2018. In short,
this indicates that the company is efficient in controlling expenses and selling the
product at the reasonable price that can increase net profit for the company
75
Common Stock Ratio
0.60
0.50
0.40
0.30
0.20
0.10
0.00
2014 2015 2016 2017 2018
Earning per share (EPS) is a net profit owned by each share outstanding in the
company. EPS of Dutch Lady Milk is increasing for the year 2014 to 2015 which is
0.49 to 0.51. Increasing in EPS shows that each share in Dutch Lady Milk is more
valuable. For the year 2016 to 2018 the Eps shows 0 for this 3years.
company. DPS of Dutch Lady Milk is decrease in year 2014 to year 2015. For the
year 2016, 2017 and 2018 dps for Dutch Lady Milk is 0. This is a good indicator to
the company and shareholders as can be proved that the company have the ability to
pay higher and stable dividend to shareholders of Heineken over the period.
Dividend yield is calculated by using dividend per share divided by share price
of the company. Dividend yield in Dutch Lady Milk is 0 from 2014 to 2018.
76
4.2.2 Intrinsic Value of Dutch Lady Milk Industries Berhad
Information 2018 2019 2020

2016 2017
(Estimated) (Estimated) (Estimated)
Revenue
Q1 (RM’000) 249786 250100
Q2 (RM’000) 246685 263540
Q3 (RM’000) 279592 281836
Q4 (RM’000) 271664 269060
1109042.47 1155409.69
Total Sales 1047727 1064536 1203715.447
6 3
QoQ
Peformance
Q1 (%) 34.36 -15.99 63.16
Q2 (%) 8.32 0.98 -10.31
Q3 (%) 10.75 1.09 11.44
Q4 (%) -6.99 -35.61 -11.43
Average
QoQ 13,215
Performance
Net Profit
Margin
Q1 (%) 12.86
Q2 (%) 12.08
Q3 (%) 13.31
Q4 (%) 11.18
Total NP
12.3575
Margin (%)
142779.752
Estimated 137049.924 148749.1364
9
Net Profit
EPS (Latest 0.394

4Q) - Sen
77
Net Profit 25204
(Latest 4Q)
(RM '000)
63969.5431
NOSH 5
2.14242461 2.23199581
Estimated 2.325311845
7 9
EPS (RM)
Current Share
Price (as at 57.981
November 10,
2019)
27.0632626
P/E
60.4050889
Target Share 57.981 62.93052507
8
Price (RM)
To calculate intrinsic value of Dutch Lady Milk Industries Berhad, some

information is required such as revenue, quarter over quarter performance, net profit
margin, current share price, latest net profit, and latest EPS. This information is
obtained from www.i3investor.com
The intrinsic value is calculated based on forecasting futures sales and profits. We
also need to calculate future EPS by using forecast profit divided by number of share
outstanding to forecast future stock price in the next two years which is 2019 and
2020 by multiplying forecast EPS with current P/E ratio. The final intrinsic value of
Dutch Lady Milk Industries Berhad is RM 60.41 in 2019 and RM 62.93 in 2020.
The current share price of Dutch Lady Milk is RM 57.98 as at November 10, 2019.
Thus, the current share price is undervalued as the price is lower than target price in
2019 and 2020 which is RM 60.41 and RM 62.93 respectively.
78
4.3.0 Fundamental Analysis of Top Glove Corporation Berhad
4.3.1 Financial Ratios of Top Glove
Income Statement (RM 'million)

6000.00
5000.00
4000.00
RM 'million
3000.00
2000.00
1000.00
0.00
2015 2016 2017 2018 2019
Graph 1: Income Statement of Top Glove from 2015 to 2019
The total revenue for Top Glove from 2015 to 2019 is increasing. This is a good
indicator that the demand for the products from customers is increasing in Malaysia.
Gross profit is the profit remaining after deducting with cost of sales. Based on the
graph, the gross profit is increasing over the period. Furthermore, operating income
and net income in 2018 is the highest within 5 years. This implies the financial
performance of company is improved and costs or expenses is controlling well.
79
Balance Sheet (RM 'million)
6000.00
5000.00
4000.00
RM 'million
3000.00
2000.00
1000.00
0.00
2015 2016 2017 2018 2019
Graph 2: Balance Sheet of Top Glove from 2015 to 2019
Based on the graph above, total assets and total liabilities and equities for Top Glove
showed the increasing in value from 2015 to 2019 which are RM5648.75 million,
RM3222.59 million and RM2426.16 million. In brief, the business of company is
expanding from year over the year that shown in the value of total assets as the
company owned more assets for business operation. Meanwhile, amount of total
equity is at the range around RM1607.96 million to RM2426.16 million.
80
Cash from Operating Activities (RM 'million)
600.00
500.00
400.00
RM 'million
300.00
200.00
100.00
0.00
2015 2016 2017 2018 2019
Graph 3: Cash from Operating Activities of Top Glove from 2015 to 2019
Based on the graph above, cash flow from operation activities is always in positive
condition. This implies that the cash generated is greater than expenses that used in
business operation. This is a good indicator as the company is able to distribute more
dividends to shareholders.
81
Liquidity Ratio
2.50
2.00
1.50
1.00
0.50
0.00
2015 2016 2017 2018 2019
Graph 4: Liquidity Ratio of Top Glove from 2015 to 2019
Based on the graph above, both ratios are decreasing over the period, especially in
2019, both of the current ratio and quick ratio are less than zero implied that the total
amount of current asset is less than total amount of current liabilities. Hence, the
company has problem in paying its current obligation in 2019.
82
Activity Ratio
12.00
10.00
8.00
6.00
4.00
2.00
0.00
2015 2016 2017 2018 2019
Graph 5: Activity Ratio of Top Glove from 2015 to 2019
Based on the graph above, the inventory turnover is increasing from 2015 to 2017, but
after that it is decreasing from 2017 to 2019. This implied that company used more
time to sell and replaced back inventory from 2015 to 2017, but used less time to sell
and replaced back inventory from 2017 to 2019. Account receivable turnover
measures the period that company used in collecting its debt from customers. The
receivable turnover is same with the inventory turnover, it is increasing from 2015 to
2017, but decreasing from 2017 to 2019. The ratio is lower showed that the company
is effective in collecting its receivable from customers.
Leverage Ratio
100.00
90.00
80.00
70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
2015 2016 2017 2018 2019
83
Graph 6: Leverage Ratio of Top Glove from 2015 to 2019
From 2015 to 2017, debt to equity ratio is decreasing but in 2018 the ratio is increased
to 92.27 per cent and increased to 94.78 per cent in 2019. Overall, the debt to equity is
low as equity stands for large percentage in Top Glove. This shows that, default risk
of interest payment on borrowing is low and also risk of bankruptcy is low.
84
Profitability Ratio
25.00
20.00
15.00
10.00
5.00
0.00
2015 2016 2017 2018 2019
Graph 7: Profitability Ratio of Top Glove from 2015 to 2019
Return on Asset (ROA) is a financial ratio used to measure percentage of net profit to
company's total assets. From 2015 to 2019, ROA ratio is at average above 10% means
that the company generated income is stand for 10 per cent of the total assets.
company equity. ROE in 2016 is the highest. The higher the ROE, the better for the
company that the company is good in utilizing money in equity to generate more
revenue and net profit.
Net profit margin is a percentage that showing the money after deducting all of the
expenses with company group revenue. The higher the net profit, the better for the
company. The net profit margin in 2016 is the highest which is 12.49%, this indicated
reasonable price that can increase net profit for the company in 2016.
85
Common Stock Ratio
3.00
2.50
2.00
1.50
1.00
0.50
0.00
2015 2016 2017 2018 2019
Graph 8: Common Stock Ratio of Top Glove from 2015 to 2019
Earnings per share (EPS) is a net profit owned by each share outstanding in the
company. EPS of Top Glove is up and down over the period of 2015 to 2019.
Increasing in EPS showed that each share in Top Glove is more valuable.
company. DPS of Top Glove is increasing over the period from 2015 to 2019. This is
a good indicator to the company and shareholders as can be proved that the company
have the ability to pay higher and stable dividend to shareholders of Top Glove over
the period.
Dividend yield is calculated by using dividend per share divided by share price of the
company. Dividend yield in Top Glove is up and down over the period of 2015 to
2019 although the share price of Top Glove is increasing over the period. Thus, higher
share price result the dividend yield decreased.
86
4.3.2 Intrinsic Value of Top Glove Corporation Berhad
Information 2017 2018 2019 2020 2021

Revenue Estimated Estimated Estimated
Q1 785583 938116
Q2 851537 958440
Q3 869641 1100574
Q4 902415 1216856
Total Sales 3409176 4213986 4329835 4448870 4571177
QoQ Peformance
Q1 12.24 6.92 8.33
Q2 13.28 3.38 -3.87
Q3 -6.43 7.85 -29.24
Q4 26.91 -13.59 7.21
Average QoQ 11.5 1.14 -4.3925
Perf (%)
2.74917
(In Decimal 0.02749
Point)
Net Profit Margin

Q1 8.85
Q2 9.2
Q3 6.32
Q4 6.73
Total NP Margin 7.775
(In Decimal 0.07775
Point)
Estimated Net 336645 345900 355409

Profit
EPS (Latest 4Q) - 0.0313

Sen
87
Net Profit (Latest 80076
4Q)
RM '000
NOSH 2558339
Estimated EPS 0.13159 0.1352 0.13892
(RM)
Estimated EPS 13.1587 13.5205 13.8922
(Sen)
Current Share 4.349 (as at 10 November 2019)

Price
P/E 33.0503
Target Share 4.349 4.46856 4.59141

Price
The current share price of Top Glove is RM4.35 as at November 10, 2019. Thus, the
current share price is undervalued as the price is lower than target price in 2020 and
2021 which is RM4.47 and RM4.59.
88
4.4.0 Fundamental Analysis of McDonald’s Corporation
4.4.1 Financial Ratios of McDonald’s Corporation
Income Statement (USD)

120000000.0
100000000.0
80000000.0
60000000.0
40000000.0
20000000.0
0.0
2014 2015 2016 2017 2018
Graph 1: Income Statement from 2014 to 2018
Total revenue for McDonald’s Corporation is increasing from 2014 to 2016

and decreasing from 2016 to 2018. This indicates the demand from customers is
decreasing in United States. Gross profit is the profit remaining after deducting with
cost of sales. Based on the graph, the gross profit, operating income and net income
are increasing over the period. This implies the financial performance of company is
improved and costs or expenses is controlling well.
89
Balance Sheet
200000000
150000000
100000000
USD
50000000
0
2014 2015 2016 2017 2018
-50000000
Based on the graph, total assets and total equity for McDonald’s Corporation
show the decreasing in value from 2014 to 2018. Meanwhile, total liabilities show the
increasing in value from 2014 to 2018 which is USD 161513726.4. In brief, the
business of company is not expanding from year over the year that shown in the value
of total assets as the company owned less assets for business operation.
90
Cash from Operating Activities (USD)
30,000,000
25,000,000
20,000,000
15,000,000
10,000,000
5,000,000
0
2014 2015 2016 2017 2018
Based on the graph above, cash flow from operation activities is increasing
over the period and always in positive condition. This implies that the cash generated
is greater than expenses that used in business operation. This is a good indicator as the
company can distribute more dividends to shareholders.
91
Liquidity Ratio
3.5
2.5
2
Axis Title
1.5
0.5
0
2014 2015 2016 2017 2018
Graph 4: Liquidity Ratio from 2014 to 2018
quick ratio is like current ratio. quick ratio is a measurement that measure firm's
inventories. Both ratios are fluctuating over the period, but the current ratio is always
on time.
92
250
200
150
100
50
0
2014 2015 2016 2017 2018
Graph 5: Activity Ratio from 2014 to 2018
Inventory Turnover is a ratio that measure the times a company has sold and
replaced inventory during a given period. From 2014 to 2017, inventory turnover is
increasing. This implies company used less time to sell and replaced back inventory.
Account receivable turnover measures the period that company used in collecting its
debt from customers. From 2014 to 2018, the inventory turnover is decreasing to 9.52
days. the ratio is lower shows that the company is effective in collecting its receivable
from customers.
93
Leverage Ratio (%)
400
350
300
250
200
150
100
50
0
2014 2015 2016 2017 2018
to 2015, debt to equity ratio is increasing. Overall, the debt to equity is low as equity
stands for large percentage in McDonald’s Corporation. This shows that, default risk
of interest payment on borrowing is low and risk of bankruptcy is low.
94
Profitability Ratio
30
25
20
15
10
0
2014 2015 2016 2017 2018

profit to company's total assets. From 2014 to 2018, ROA ratio is at average above
10% means that the company generated income is stand for 10 percent of the total
assets.
company equity. ROE decreasing from 2014 to 2015 and increasing from 2015 to
2018. The higher the ROE, the better for the company that the company is good in
utilizing money in equity to generate more revenue and net profit.
Net profit margin is a percentage that showing the money after deducting all the
expenses with company group revenue. The higher the net profit, the better for the
company. From 2014 to 2018, net profit margin is always above 15%. this indicates
reasonable price that can increase net profit for the company.
95
Common Stock Ratio
35
30
25
20
15
10
0
2014 2015 2016 2017 2018
-5
Earnings per share (EPS) is a net profit owned by each share outstanding in
the company. EPS of McDonald’s Corporation is increasing over the period from
2014 to 2018. Increasing in EPS shows that each share in McDonald’s Corporation is
more valuable.
company. DPS of McDonald’s Corporation is increasing over the period from 2014 to
2018. This is a good indicator to the company and shareholders as can be proved that
the company can pay higher and stable dividend to shareholders of McDonald’s
Corporation over the period.
Dividend yield is calculated by using dividend per share divided by share price of
the company. Dividend yield in McDonald’s Corporation is decreasing from 2014 to
2018 except 2016 as the share price of McDonald’s Corporation is increasing over the
period. Thus, higher share price result the dividend yield decreased. However, the
McDonald’s Corporation dividend yield is mostly same to fixed deposit which is
around 3% from 2014 to 2018.
96
4.4.2 Intrinsic Value of McDonald’s Corporation
Figure 4.4.2: Intrinsic Value based on Discounted Cash Flow Method of 10 Years
Figure 4.4.2: Present Value of 10 years Cash Flows
Table 4.1: Beta Value for getting a Discount Rate
The method in calculating intrinsic value of MCD is based on discounted cash

flow method. This method we would forecast cash flow from operating activities in
the next 10 years to calculate intrinsic value of MCD. Some important valued and
information is needed to calculate intrinsic value of MCD which are net cash
generated from operating cash flow, cash and short-term investment, cash flow
growth rate, number of share outstanding and discount rate in the current year. This
information is obtained from www.reuters.com
Discount rate is determined by beta value which can be obtained from

www.reuters.com and convert the beta value into discount rate based on the table 4.1.
97
cash flow growth rate in the next 1 year to 3 year is determined by average growth
rate of net profit from 2014 to 2018 and we assume that growth rate is still maintain at
15 per cent of growth rate each year in the next 4 year to 10 year. This is because the
net profit would increase in line with inflation, population growth and the company
have consistent historical track record.
The cash flow from operating activities for the next ten years is obtained by using
cash flow multiplied with cash flow growth rate. After that, the value multiplied again
by discount factor in order to get present value of cash flow from operating activities
in the next 10 years.
Then, the value is divided by number of shares outstanding to get the intrinsic
value of MCD and then plus with cash per share and minus with debt per share to get
the final intrinsic value. The final intrinsic value of MCD is US$ 102.80. Thus, the
price of MCD is currently overvalued as the current price is above its intrinsic value.
98
4.5.0 Panasonic Corporation
4.5.1 Financial Ratio of Panasonic Corporation
Income Statement
9,000.0
8,000.0
7,000.0
6,000.0
Billion Yen
5,000.0
4,000.0
3,000.0
2,000.0
1,000.0
0.0
2015 2016 2017 2018
Graph 1: Income Statement of Panasonic Corporation from 2015 to 2018.
The graph above show the total revenue, gross profit, operating profit and net profit of
Panasonic Corporation from 2015 to 2018. We can see that the total revenue shows a
decreasing trend from 7,715 billion yen in 2015 to 7,343.7 billion yen in 2017. In
2018, the total revenue increased 8.69% to 7,982.2 billion yen in the year of 2018.
Next, the gross profit of Panasonic Corporation shown an unstable trend throughout
2015 to 2018. The gross profits had increased 3.24% from 2187.8 billion yen in 2015
to 2258.6 billion yen in 2016. It slightly decreased 3.19% to 2186.5 billion in 2017
and increased 6.98% to 2339.2 billion yen in 2018.
The operating income of Panasonic Corporation decreased 16.99% from 381.9 billion
yen in 2015 to 317 billion yen in 2017. In 2018, the operating income increased
24.95% to 396.1 billion yen in 2018.
Lastly, the net income of Panasonic Corporation increased in 2016. It increased

13.93% from 236.9 billion yen to 269.9 billion yen. However, the net income dropped
31.01% to 186.2 billion yen in 2017. It then increased 36.84% to 254.8 billion yen in
2018.
99
Balance Sheet
7,000.0
6,000.0
5,000.0
4,000.0
Billion Yen
3,000.0
2,000.0
1,000.0
0.0
2015 2016 2017 2018
Graph 2: Balance Sheet of Panasonic Corporation from 2015 to 2018
According to the graph above, we can see that the total assets of Panasonic
Corporation decreased 7.87% from 5956.9 billion yen in 2015 to 5488 billion yen in
2016. However, the total assets increased 14.63% to 6291.1 billion yen in 2018.
Next, the total liabilities show the same trend as total assets where the total liabilities
decreased 3.12% from 3964.4 billion yen to 3840.8 billion yen. The total liabilities
then increased 14.79% to 4408.9 billion yen in 2018.
The total equities also showing the same trend as the total equities decreased 17.33%
from 1992.6 billion yen in 2015 to 1647.2 billion yen in 2016 and increased 14.27%
to 1882.3 billion yen in 2018.
100
Cash from Operating Activity (Billion Yen)
600.0
500.0
400.0
300.0
200.0
100.0
0.0
2015 2016 2017 2018
Based on the graph above, the cash from operating activity decreased 21.59% from
491.5 billion yen in 2015 to 385.4 billion yen in 2016. In 2018, cash from operating
activity increased 9.81% to 423.2 billion yen. The cash flow from operation activities
is always in positive condition. This implies that the cash generated is greater than
expenses of the business operation. This is a good indicator as the company is able to
distribute more dividends to shareholders.
101
Liquidity Ratio
1.40
1.20
1.00
0.80
0.60
0.40
0.20
0.00
2015 2016 2017 2018
Graph 4: Current Ratio and Quick Ratio of Panasonic Corporation from year 2015 to
2018
Based on the graph above, the current ratio is fluctuated from 2015 to 2018. The
current ratio of 2015 was 1.25. The current ratio decreased 0.08 to 1.17 in 2016. The
current ratio had a small increase to 1.18 in the year of 2017. In 2018, the current ratio
decreased 0.05 to 1.13 in 2018. Even thought the current ratio of Panasonic
Corporation was unstable but it still maintained above 1.0 which mean that Panasonic
Corporation had the ability to pay back its short-term maturing obligations and to
meet unexpected needs for cash.
Next, the quick ratio also shown the same trend with current ratio where the quick
ratio in 2015 is 0.84. The quick ratio decreased 0.1 to 0.74 in 2016. In 2017, the quick
ratio raised 0.04 to 0.78 in 2017 and decreased 0.09 to 0.69 in 2018. The value greater
than 1 indicate that the corporation had enough current assets to pay back their current
liability. This indicate that Panasonic Corporation does not has the ability to meet it
short-term obligation with it most liquid assets.
102
Activity ratios
10.00
9.00
8.00
7.00
6.00
5.00
4.00
3.00
2.00
1.00
0.00
2015 2016 2017 2018
Graph 5: Activity Ratio of Panasonic Corporation from Year 2016 to 2018
Based on the graph above, the assets turnover in 2015 is 1.38. the assets turnover had
decreased 0.1 to 1.28 in the year of 2017. The assets turnover raised back to 1.3 in the
year of 2018. The ratio shows that Panasonic Corporation are using their assets
efficiently to generate sales.
Next, the receivable ratio in 2015 is 7.72. The receivable ratio increased 1.01 times to
8.73 at 2017. In 2018, the receivable ratio decreased 0.27 to 8.46 in 2018. Receivable
ratio is an indicator used to measure the time required for a business to collect debt
given out. The ratio of Panasonic Corporation showed that they are slow in collecting
credit account.
103
Leverage Ratio
70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
2015 2016 2017 2018
Graph 6: Leverage ratio of Panasonic Corporation from 2015 to 2018.
Based on the graph above, the leverage ratio of Panasonic Corporation showed
fluctuated trend from year 2015 to year 2018. The leverage ratio in 2015 was 48.83
times and it decreased 4.83% to 4%. In 2018, the Leverage ratio increased 21.85% to
65.85%. leverage ratio is used to measure the level of debt in a firm. It also shows the
number of debt that company used to support their business compared to the number
of stockholders’ equity that used to support the business.
104
Profitability Ratio
16.00
14.00
12.00
10.00
Percentage (%)
8.00
6.00
4.00
2.00
0.00
2015 2016 2017 2018
Graph 7: Profitability Ratio of Panasonic Corporation from 2015 to 2018.
According to the graph above, the return of assets (ROA) of Panasonic Corporation
shown an unstable trend from 2015 to 2018. The ROA was 3.21 in year 2015 and it
decreased 0.61% to 2.60% in year 2017. The ROA then increased 1.25% to 3.85% in
year 2018 which is highest among other years. The low return on assets shows that
Panasonic corporation does not manage their assets efficiently to generate profits.
Next, the return on equity (ROE) if Panasonic Corporation shows that there increase
between year 2015 to year 2018. The ROE of 2015 was 10.65% and it increased
3.75% to 14.4% in year 2018. The return of equity shown that Panasonic Corporation
managed the fund invested by shareholder efficiently to generate profits.
The net profit margin also showing the same trend with return on equity as the net
profit margin in 2015 was 2.33%. The net profit margin decreased 0.3% to 2.03% in
2017. The net profit margin then increased 0.93% to 2.96%in 2018. The range of net
profit margin is maintained between 2-3% it shows that the profitability of Panasonic
Corporation is low after considering all expenses incurred by the company during the
period.
105
Common Stock Ratio
0.12
0.1
0.08
Yen per Share
0.06
0.04
0.02
0
2015 2016 2017 2018
Graph 8: Common Stock Ratio of Panasonic Corporation from 2015 to 2018.
Based on the graph above, the earning per share of Panasonic Corporation was
fluctuated from 2015 to 2018. The earning per share in year 2015 was 0.07 yen per
share and it decreased 0.02 yen to 0.06 yen per share in 2017. In 2018, the earning per
share increased 0.04 yen per share. Even though the earning per share is not high I the
stock market, but the earning per share was stable.
Next, the dividend per share of Panasonic Corporation was showing a decreasing
trend from 2015 to 2018. The dividend per share in 2015 is 0.04 yen per share. The
dividend per share had decreased 0.02 yen to 0.02 yen per share in the year of 2018.
106
4.5.2 Intrinsic Value of Panasonic Corporation
2019 2020
2016 2017 2018
(Estimated) (Estimated)
Revenue
Q1 (RM
56021.40 65911.10 72711.80
Million)
Q2 (RM
63190.10 69904.50 76554.00
Million)
Q3 (RM
67445.10 74429.60 75684.70
Million)
Q4 (RM
68405.00 75196.80 75045.30
Million)
285442.0
Total Sales 255061.60 299995.80 305801.19 311718.93
0
QoQ
Peformance
Q1 -7.65 -3.65 -3.30
Q2 12.80 6.06 5.28
Q3 6.73 6.47 -1.14
Q4 1.42 1.03 -0.84
Average QoQ 1.93515749
Performance 5
Net Profit
Margin
Q1 2.6
Q2 3.7
Q3 4.1
Q4 2.3
Total NP
3.175
Margin
Estimated 9709.18782
9524.86665 9897.075897
Net Profit 1
EPS (Latest
0.7479
4Q) - Sen
Net Profit
(Latest 4Q) 1745.4
RM '000
2333.73445
NOSH
6
Estimated EPS 4.08138407 4.16036528
4.240874907
(RM) 7 7
Estimated 408.138407 416.036528
424.0874907
EPS (Sen) 7 7
Current Share 38.87
Price (as at 11
107
November
2019)
9.52373000
P/E
7
Target Share
38.87 39.62 40.39
Price
Intrinsic value is a way to describe the perceived or true value of an asset. The
intrinsic value does not always identical to the current market price because
sometimes assets can be undervalued or overvalued. Intrinsic value is commonly used
for fundamental analysis, which is investors use to assess stocks and option pricing.
The final intrinsic value of Panasonic Corporation is RM 38.87 in 2018, RM 39.62 in

2019, and RM 40.39 in 2020. The current share price of Panasonic Corporation is RM
38.87 as at 11 November 2019 which is undervalued compare to other years.
108
5.0 Technical Analysis
Technical analysis is study of market share price that always fluctuated by the
demand and supply in the stock market. Direction of a share price which consist of 3
trends which is uptrend, downtrend, and sideway. The trends can be determined by
using technical analysis. Furthermore, technical analysis is a tool that can be used to
determine entry point of a stock at the right entry point. In this report, we would use
moving average, MACD, RSI, and support and resistance level in our technical
analysis.
5.1.0 Technical Analysis of HEIM
5.1.1 MACD
Picture 1: MACD Indicator in HEIM Price Chart
Moving Average Convergence Divergence (MACD) is a trend-following

momentum indicator that shows the current trend of a stock. However, this indicator
is only effective to using it in the trending markets such as uptrend and downtrend and
not effective when using it in sideway market as the MACD lines would cross over
more often in the sideway market. After that, MACD also can be used to spot
divergence condition in a stock.
In the chart above, MACD in price chart of HEIM is crossing above 0 as at

August 21, 2019. this implies that there have high probability the current trend is
shifting to a new uptrend and provide the right entry price to investors to purchase it
and hold it until exit signals occur such as divergence between the share price and
109
MACD or MACD is crossing below zero. Since end of August until now, the MACD
is above zero. This shows that the current trend is uptrend.
5.1.2 RSI (Relative Strength Index)
Picture 2: RSI Indicator in HEIM Price Chart
The relative strength index (RSI) is a technical indicator that used in measuring
the overbought and oversold price level in a stock. Stock Price is overbought when
RSI is above 70 and there is a probability the share price would drop in the next
trading day that as a small correction of the current trend. Meanwhile, stock price is
oversold when RSI is below 20 and there is a probability the share price would raise
in the next trading day that as a small correction of the current trend.
In the chart price above, there are 2 times overbought occur in HEIM that shown
in the RSI indicator. RSI is above 70 in October 18, 2019 and November 15,2019.
After that, the next trading day, the share price is closing below previous closing day
share price as a small correction from overbought level.
110
5.1.3 Moving Average
Picture 3: Moving Average 50, 150 and 200 in HEIM Price Chart
Moving Average is data that showing an average closing price of a specific

period. Moving averages are plotted on the chart that can be used to determine to
current trend in a stock and, act as a support or resistance level. However, Moving
averages is a lag indicator that the indicator is calculated by using historical data.
As shown in the chart above, we used MA50 , MA150 and MA200 in our chart
for long-term strategy in investing in the Bursa Malaysia. As at October 10, 2019,
MA 50 is crossing above MA 150 and both lines are sloping upward that indicating
buy opportunity for HEIM. After that, MA 50, 150 & 200 are sloping upward show
that the current trend for the HEIM is uptrend.
111
5.1.4 Support and Resistance
Picture 4: Support and Resistance Lines in HEIM Price Chart
Support and Resistance level is a predetermined level of price in a stock at which

share price would rebound from the lower or reverse from the higher share price.
these levels are created by multiple touches of share price without a breakthrough of
the level.
In the chart pattern above, we can find resistance level and support level in HEIM
which is created by two candlesticks touch at the similar price at a specific period.
Resistance level is at RM 25.018 which is created by 2 candlestick and the candlestick
is reversed back to the lower share price on the next trading days. However, the share
price is breakout from resistance level with higher volume of transaction during the
breakout day at October 16, 2019 as the share price is closing above resistance level.
After the breakout, the resistance level would become support level. Thus, the buy
signal occurs when the resistance breakout at October 16,2019. that showing the share
price may continue with new uptrend.
After that, we found that support level at RM 22.469 that the candlestick is not
dropping further at that share price level which is known as support level and rebound
to the higher price.
112
5.2.1 MACD
Picture 1: MACD Indicator in Dutch Lady Milk Price Chart
The Moving Average Convergence Divergence (MACD) is used to analyses the

changes of the strength, direction, momentum, and direction of the trend of Dutch
Lady Milk Industries Berhad stock’s price. The diagram above shows the graph of
Moving Average Convergence Divergence of Dutch Lady Milk Industries Berhad
stock from March 2019 to October 2019. The histogram shows the distance between
the Moving Average Convergence line (blue line) with the signal line (red line).
When the histogram is above the base line, the Moving Average Convergence line
was crossing above the signal line and vice versa. Since end of October until now, the
MACD is above zero. This shows that the current trend is uptrend.
113
Picture 2: RSI Indicator in Dutch Lady Milk Price Chart
The Relative Strength Index (RSI) shows the strength and weakness of Dutch Lady
Milk Industries Berhad based on its closing price within the trading periods. Stock
Price is overbought when RSI is above 70 and there is a probability the share price
would drop in the next trading day that as a small correction of the current trend.
Meanwhile, stock price is oversold when RSI is below 20 and there is a probability
the share price would raise in the next trading day that as a small correction of the
current trend. From the diagram above, there are 1 time overbought occur in Dutch
Lady Milk Industries Berhad that shown in the RSI indicator. RSI is above 70 in
September 18. After that, the next trading day, the share price is closing below
previous closing day share price as a small correction from overbought level.
114
Picture 3: Moving Average 50, 150 and 200 in Dutch Lady Milk price chat
The diagram above show the moving average of Dutch Lady Milk Industries
Berhad. Moving averages are plotted on the chart that can be used to determine to
current trend in a stock and, act as a support or resistance level. We can determine the
stock whether is it bullish or bearish at the time period. Based on the graph we can see
that the MA 50 is crossing above MA 150 and moving steadily for the early period.
After that, MA50, 150 and 200 are sloping downward at the end of the period. This
shows that, the current trend for Dutch Lady Milk is moving steadily at the beginning
and move downward at the end of the years.
115
Picture 4: Support and Resistance Lines in Dutch Lady Milk Price Chart
Support and Resistance level is a predetermined levels of price in a stock at which

these levels are created by multiple touches of share price without a breakthrough of
the level. Based on the diagram above, we can found resistance level and support
level in Dutch Lady Milk Industries Berhad which is created by two candlesticks
touch at the similar price at a specific period. Resistance level is at RM 64.516 which
is created by 2 candlestick and the candlestick is reversed back to the lower share
price on the next trading days. However, the share price is breakout from resistance
level with lower volume of transaction during the breakout day at September 15, 2019
as the price closing below resistance level. After that, we found that support level at
RM 62.955 that the candlestick is not dropping further at that share price level which
is known as support level and rebound to the higher price.
116
5.3.0 Technical Analysis of Top Glove
5.3.1 MACD
Picture 1: MACD Indicator in Top Glove Price Chart
In the chart above, MACD in price chart of Top Glove is crossing above 0 as at
August 29, 2019. this implies that there have high probability the current trend is
shifting to a new uptrend and provide the right entry price to investors to purchase it
and hold it until exit signals occur such as divergence between the share price and
MACD or MACD is crossing below zero. However, the MACD of Top Glove is
going down below 0 at September 27, 2019 and going up again above 0 at November
14, 2019. Since the MACD is above zero currently, this shows that the current trend is
uptrend.
117
Picture 2: RSI Indicator in Top Glove Price Chart
In the chart price above, there are 1 time oversold occur in Top Glove that shown in
the RSI indicator, RSI is below 20 in October 15,2019. This show that the share price
will be raised in the next trading day.
118
Picture 3: Moving Average 50, 150 and 200 in Top Glove Price Chart
As shown in the chart above, we used MA50, MA150 and MA200 in our chart for
long-term strategy in investing in the Bursa Malaysia. As at August 19, 2019, MA 50
is crossing above MA 150 and both lines are sloping downward. Furthermore, at
November 25, 2019, MA 150 is crossing above MA 200 and both lines are also
sloping downward. After that, MA 50, 150 & 200 are sloping downward show that
the current trend for the Top Glove is downtrend.
119
Picture 4: Support and Resistance Lines in Top Glove Price Chart
In the chart pattern above, we found that resistance level and support level in HEIM
which is created by two candlesticks touch at the similar price at a specific period.
Resistance level is at RM5.118 which is created by 2 candlestick and the candlestick
is reversed back to the lower share price on the next trading days. After that, we found
that support level at RM4.479 that the candlestick is not dropping further at that share
price level which is known as support level and rebound to the higher price.
120
5.4.0 Technical Analysis of McDonald’s Corporation
5.4.1 MACD
Picture 1: MACD Indicator in McDonald’s Corporation Price Chart
Moving Average Convergence Divergence (MACD) is a trend-following

momentum indicator that shows the current trend of a stock. However, this indicator
is only effective to using it in the trending markets such as uptrend and downtrend and
not effective when using it in sideway market as the MACD lines would cross over
more often in the sideway market. After that, MACD also can be used to spot
divergence condition in a stock.
In the chart above, MACD in price chart of McDonald’s Corporation is crossing

below 0 as at September 16, 2019. this implies that there has high probability the
current trend is shifting to a new downtrend and generates a sell signal to investors to
exit this stock. Since end of September until now, the MACD is below zero. This
shows that the current trend is downtrend.
121
Picture 2: RSI Indicator in McDonald’s Corporation Price Chart
The relative strength index (RSI) is a technical indicator that used in measuring
the overbought and oversold price level in a stock. Stock Price is overbought when
RSI is above 70 and there is a probability the share price would drop in the next
trading day that as a small correction of the current trend. Meanwhile, stock price is
oversold when RSI is below 20 and there is a probability the share price would raise
in the next trading day that as a small correction of the current trend.
In the chart price above, there are 2 times oversold occur in McDonald’s
Corporation that shown in the RSI indicator. On 28 October 2019, RSI is below 20
and the share price is raised on the next trading day as a small correction from the
downtrend.
122
Picture 3: Moving Average 50, 150 and 200 in McDonald’s Corporation Price Chart
Moving Average is data that showing an average closing price of a specific

period. Moving averages are plotted on the chart that can be used to determine to
current trend in a stock and, act as a support or resistance level.
Based on the chart above, the candlesticks were above Moving Average (MA
50) of 50 days, 150 days and 200 days from the previous date before September 10,
2019. After that, the candlestick is dropped below the MA 50 as at September 10,
2019. Moving average of 50 days acts as resistance line that the share price is unable
to break upward of MA 50. It generates sell signal for investors. On November 11,
2019, 50 Moving Average (MA 50) is crossing below 150 Moving Average (MA150)
and MA 50 line is sloping downward. Candlestick is located at below MA 50, 150
and 200. It shows another sell signal to the investors that the current trend might shift
to downtrend.
123
Picture 4: Support and Resistance Lines in McDonald’s Corporation Price Chart
Support and Resistance level is a predetermined level of price in a stock at which

These levels are created by multiple touches of share price without a breakthrough of
the level.
In the chart pattern above, we can find resistance level and support level in
McDonald’s Corporation which is created by two candlesticks touch at the similar
price at a specific period. Resistance level is at USD 220.95 which is created by
several candlestick were near the same price and the candlestick is reversed back to
the lower share price on the next trading days.
After that, we found that support level at USD 206.29 that the candlestick is not
dropping further at that share price level which is known as support level and rebound
to the higher price. However, the candlestick was opened below the support line as at
October 22, 2019 and closing below its support line. The share price is dropping
further after breakout from support line as the new trend is shift to downtrend. Hence,
it generates a sell signal to investors.
124
5.5.0 Technical Analysis of Panasonic Corporation.
5.5.1 MACD
Picture 1: MACD Indicator in Panasonic Corporation Price Chart
The Moving Average Convergence Divergence (MACD) is used to analyses

the changes of the strength, direction, momentum, and direction of the trend of
Panasonic Corporation stock’s price. The diagram above shows the graph of Moving
Average Convergence Divergence of Panasonic Corporation stock from May 2019 to
October 2019. Moving Average Convergence showed the difference between two
exponential moving average of closing prices. The Moving Average Convergence
Line formed by subtracting the 26-period exponential moving average from the 12-
period exponential moving average. The red line was the signal line that showed the
chances to purchase and sell the stocks. When the Moving Average Convergence
Line, which was the blue line crossed upward the red line, it means that it was a good
opportunity to buy the stock as the Moving Average Convergence was positive value.
The graph in the diagram above showed the exponential moving average of
the stock price. The histogram shows the distance between the Moving Average
Convergence line (blue line) with the signal line (red line). When the histogram is
above the base line, the Moving Average Convergence line was crossing above the
signal line and vice versa.
125
The Moving Average Convergence line crossed above the signal line three
times in the year of 2019. The first time the Moving Average Convergence line
crossed above the signal line was in 28th of May, 22nd of August and 16th of
October.
5.5.2 Relative Strength Index
Picture 2: RSI Indicator in Panasonic Corporation Price Chart
The Relative Strength Index shows the strength and weakness of Panasonic
Corporation based on it closing price within the trading periods. If the measure scale
is above 70, the Relative Strength Index is considered as overbought which is
represent by the upper dotted line from the diagram. If the measure scale is below 30,
the Relative Strength Index is considered as oversold which is represent by the lower
dotted line on the diagram.
From the diagram above, the oversold of stock occurred in 10th of May 2019
and 5th of August 2019 which is a sign for investor to purchase the stock. The
overbought of stock occurred in 10th of September and 1st of November 2019 which
shows that its time to sell the stock.
126
5.5.3 Moving Average.
Picture 3: Moving Average in Panasonic Corporation Price Chart
The diagram above show the moving average of Panasonic Corporation. The
moving average line function is to smooth out the short-term fluctuation in stock price
and it also helps by highlighting the long-term trends in the stock’s price.
The moving average is also used to determine the stock whether is it bullish or
bearish at the time period. If the shorter-term moving average (blue line) crossed
above the longer-term moving average (red line), it shows that the stock is at bullish
state as the stock price is increasing. However, if the shorter-term moving average
crossed below the longer-term moving average, the stock is in a bearish state where
investor should consider to sell the stock.
Based on the diagram above, Panasonic Corporation stock was in a longer

period of bullish condition where the red line was under the blue line. It good for
shareholder that purchase the stock hold the stock because the price is mostly
increasing.
127
5.5.4 Support and Resistant.
Picture 4: Support and Resistance Lines in Panasonic Corporation Price Chart
Support and resistance are used by investor to determine the barriers for the
increase and decrease stock price. The support is a price level that the stock price
founded a point to bounce back while the resistance level is a point that achieve by
stock price that preventing the price level to rise. The price would keep increasing or
decreasing even if the price level had exceeded the support or resistance level.
Investor had to sell the stock when the stock price reached the resistance level
because the stock price would probably start to decrease. The resistance level of the
stock is represented by the red line in the diagram. Most stock would not increase
when reach resistance level but sometimes it would continue increase until reach
another resistance level. For example, the stock price in 1 st November 2019 continue
to increase even thought it had exceeded the resistant level. The stock price would
stop increased until it reaches another resistance level.
Next, investor would purchase the stock when stock price reached support
level because the stock price would likely to start to bounce upward. Investor would
make a profit if they purchase the stock at this price level. The stock price would
continue to decrease even though it reached support level until it reached another
support level. For example, in 5th August 2019, the stock price continues to decrease
although it exceeded the support level.
The support and resistance line were only reference to investor because each
investor had different perception in their support and resistance level.
128
6.0 Portfolio
BUY
Name of Buy
Buy Date Stock Code Shares Price Comm Total Cost
4.4
1-Oct-19 TOPGLOV 7113 250 9 1,122.50
23.8
3-Oct-19 HEIM 3255 250 5 5,962.50
210.0
3-Oct-19 MCD MCD 200 3 42,006.00
34.0
4-Oct-19 PCRFY 6752 200 6 6,812.00
55.2
5-Oct-19 DLADY 3026 250 0 13,800.00
23.8
7-Oct-19 HEIM 3255 250 0 5,950.00
33.9
8-Oct-19 PCRFY 6752 250 4 8,485.00
4.4
8-Oct-19 TOPGLOV 7113 250 7 1,117.50
207.2
15-Oct-19 MCD MCD 200 2 41,444.00
25.1
16-Oct-19 HEIM 3255 700 0 17,570.00
4.2
16-Oct-19 TOPGLOV 7113 800 9 3,432.00
56.3
20-Oct-19 DLADY 3026 250 3 14,082.50
194.6
25-Oct-19 MCD MCD 600 1 116,766.00
57.1
5-Nov-19 DLADY 3026 400 0 22,840.00
192.1
5-Nov-19 MCD MCD 500 8 96,090.00
4.3
8-Nov-19 TOPGLOV 7113 300 5 1,305.00
25.7
13-Nov-19 HEIM 3255 400 0 10,280.00
34.0
21-Nov-19 PCRFY 6752 400 2 13,608.00
55.8
22-Nov-19 DLADY 3026 250 0 13,950.00
GRAND TOTAL - 436,623.00
129
SELL
No of
Selling shares Selling Sales Total Gain /
Date Sold Price Value Proceeds Loss Gain %
196. 59,067.0 59,06 17,061.0 40
30-Oct-19 300.00 89 0 7.00 0 .62
37. 9,435. 9,43 2,623. 38
1-Nov-19 250.00 74 00 5.00 00 .51
56. 16,950.0 16,95 2,867. 20
1-Nov-19 300.00 50 0 0.00 50 .36
4. 1,350. 1,35 227. 20
5-Nov-19 300.00 50 00 0.00 50 .27
39. 11,796.0 11,79 3,311. 39
12-Nov-19 300.00 32 0 6.00 00 .02
26. 7,800. 7,80 1,837. 30
14-Nov-19 300.00 00 00 0.00 50 .82
194. 77,600.0 77,60 36,156.0 87
14-Nov-19 400.00 00 0 0.00 0 .24
55. 16,590.0 16,59 2,790. 20
15-Nov-19 300.00 30 0 0.00 00 .22
4. 1,804. 1,80 686. 61
15-Nov-19 400.00 51 00 4.00 50 .43
26. 13,140.0 13,14 7,190. 120
19-Nov-19 500.00 28 0 0.00 00 .84
26. 20,892.0 20,89 3,322. 18
20-Nov-19 800.00 12 0 2.00 00 .91
57. 25,965.0 25,96 3,125. 13
20-Nov-19 450.00 70 0 5.00 00 .68
194. 155,304.0 155,30 38,538.0 33
20-Nov-19 800.00 13 0 4.00 0 .00
4. 4,140. 4,14 708. 20
20-Nov-19 900.00 60 00 0.00 00 .63
421,833.0 421,83 120,443.0 565
0 3.00 0 .54
130
7.0 Conclusion
From the above analysis, we can conclude that risk can be reduced from the
adverse changes in stock price by diversifying our investment in different sectors and
countries. At the end of the trading period, we have a total net gain of RM
120,443.00.
It is important for investors to do few analyses regarding economic, industry and

company to guide us in selecting a good company in fundamental perspective. After
that, technical analysis is a technique that can let us find a right entry point by
studying price chart to invest in the company that we have selected.
From this assignment, we have learnt one important lesson that investment
decisions should be consider trade-off between risk and return on the investment. The
decision on investment should not make by emotional decision which is anxiety and
greed. We also learnt that loss is a part of investment. Therefore, the important part is
cut losses when stop-loss target is reached to minimize the losses. Investment analysis
is a significant practice to help us reduce our unsystematic risk by diversified our
investment and guiding us to make a right decision on investment to increase our
profits in the investment.
131
8.0 Reference
2018 Annual Report of Heineken, Retrieved from
http://disclosure.bursamalaysia.com/FileAccess/apbursaweb/download?
id=192751&name=EA_DS_ATTACHMENTS
Department of statistics, Retrieved from
https://www.dosm.gov.my/v1/index.php?
r=column/ctwoByCat&parent_id=80&menu_id=YmJrMEFKT0p0WUIxbDl1bzZyd
W9JQT09
Guruforcus, Retrieved from
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Investment Analysis Group Project

First Semester Session 2019/2020 (A191)

Dr. Adilah binti Azhari

Name Matric Number

2.1.1 Monetary Policy and Fiscal Policy 6

2.1.2 Gross Domestic Malaysia 7

2.1.3 Unemployment Rate 8

2.1.4 Inflation Rate 9

2.1.5 Consumer Price Index 10

2.1.6 Balance of Trade 11

2.2.0 United State of America 13

2.2.1 Monetary Policy and Fiscal Policy 13

2.2.2 Gross Domestic Malaysia 15

2.2.3 Unemployment Rate 16

2.2.4 Inflation Rate 17

2.2.5 Consumer Price Index 18

2.2.6 Balance of Trade 19

2.3.1 Monetary Policy and Fiscal Policy 20

2.3.2 Gross Domestic Malaysia 22

2.3.3 Unemployment Rate 23

2.3.4 Inflation Rate 24

2.3.5 Consumer Price Index 25

2.3.6 Balance of Trade 26

3.0 Industry Analysis 28

3.1.0 Heineken Malaysia Berhad 28

3.1.1 Business Overview of Heineken 29

3.1.3 Competitor Analysis 32

3.2.0 Dutch Lady Milk Industries Berhad 33

3.2.1 Business Overview of Dutch Lady Milk 33

3.2.2 SWOT Analysis 34

3.2.3 Competitor Analysis 37

3.3.0 Top Glove Corporation Berhad 38

3.3.1 Business Overview of Top Glove 38

3.3.2 SWOT Analysis 39

3.3.3 Competitor Analysis 41

3.4.0 McDonald’s Corporation 42

3.4.1 Business Overview of McDonald’s Corporation 42

3.4.2 SWOT Analysis 43

3.4.3 Competitor Analysis 49

3.5.0 Panasonic Corporation 50

3.5.1 Business Overview of Panasonic Corporation 50

3.5.2 SWOT Analysis 51

3.5.3 Competitor Analysis 55

4.0 Fundamental Analysis 57

4.1.0 Heineken Malaysia Berhad 58

4.1.1 Financial Ratios of Heineken 58

4.1.2 Intrinsic Value of Heineken Malaysia Berhad 67

4.2.0 Dutch Lady Milk Industries Berhad 68

4.2.1 Financial Ratios of Dutch Lady Milk 76

4.2.2 Intrinsic Value of Dutch Lady Milk Industries Berhad 76

4.3.1 Financial Ratios of Top Glove 78

4.3.2 Intrinsic Value of Top Glove Corporation Berhad 86

4.4.0 McDonald’s Corporation 88

4.4.1 Financial Ratios of McDonald’s 88

4.4.2 Intrinsic Value of McDonald’s Corporation 96

4.5.0 Panasonic Corporation 98

4.5.1 Financial Ratios of Panasonic 98

4.5.2 Intrinsic Value of Panasonic Corporation 108

5.0 Technical Analysis 108