EPS figures calculated from Net Profit / 558,379,008 shares outstanding.
RAKCEC share price as of 28 Oct 2008 was 2.09 dhs, so 2008 estimated PE is about 2.09 / 0.40 = 5.2, based on Q3 earnings, which is around half the market average PE of about 10. 2008 PE estimate based on M9 earnings is the same.
The BOD report says RAK Ceramics "is absolutely free from risks of Real Estate Mortgage & Financial Crisis" so does that mean here's an option for some cheap shares that could be a safe bet? Well, nothing is safe. If a bank stops lending RAK Ceramics money (they have AED 1.275 bn in Short Term Loans & Overdrafts) then that could be a problem. What if RAK Ceramics customers default on their bills, or cancel orders? Current Assets include less than AED 200m in cash but AED 1.45 bn in Accounts Receivable and AED 1.06 bn in Inventory. To say "absolutely free" is perhaps a little on the optimistic side.
Ras Al Khaimah Ceramics shares fell 5.2% to AED 2.20 yesterday, in light trading as usual. So far this morning in the first few minutes, there have been no trades.
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