FACULTY OF BUSINESS AND

MANAGEMENT BA111
DIPLOMA IN BUSINESS STUDIES

INVESTMENT MANAGEMENT (FIN358)

GROUP ASSIGNMENT

THE RESULT FUNDAMENTAL AND

TECHNICAL ANALYSES OF DIGI.COM BERHAD (6947)

GROUP MEMBER:

NAME Matrix No.

NUR AFZA AQILAH BT FAIZAN 2021109601

NURUL FATIN AMIRA BT HISHAM 2021126973

NUR ZULAIKHA BT ZAIDI 2021111595

GROUP: KBA1115A

PREPARED TO:
MADAM NAJAH BINTI MOKHTAR

SUBMISSION DATE:
9th JULY 2023
 TABLE OF CONTENT

NO. CONTENT PAGES

1. Introduction
Concept of Fundamental Analysis
Concept of Technical Analysis
2. Fundamental Analysis

i) Liquidity Ratio
ii) Market Value Ratio
iii) Profitability Ratio
iv) Leverage Ratio

3. Technical Analysis

4. Conclusion

5. References

6. Appendices
 INTRODUCTION

Mutiara Telecommunications Sdn Bhd is the other name for DiGi Telecommunications Sdn Bh. early in
1999. Prior to changing its name to Digi Telecommunications Sdn Bhd, the company was known as
Mutiara Telecommunications Son Bhd. Digi Telecommunications Sdn Bhd is a mobile communication
firm with its headquarters in Malaysia that specializes in the establishment, upkeep, and delivery of
telecommunication and related services. The business was established on May 24, 1995, and has its
headquarters in Malaysia's Shah Alam. The Telenor group, a Norwegian telecommunications firm,
owned 49 percent of the shares of Digi.com Bh as of July 30, 2021. The Employees Provident Fund
Board, Amanah Saham Bumiputera, and other entities are among the other shareholders.

Celcom and Maxis are the business's rivals. Additionally, DiGi is the first company in the telecom
sector to introduce and run a fully digital cellular network in Malaysia. Therefore, Digi may be able to
increase its market share in Malaysia and compete with other businesses. The mobile communication
services offered by Digi include voice over prepaid and postpaid plans, SMS, Internet plans and
services, international roaming, internationalcallingcards, WAPservices, &more.

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CONCEPT OF FUNDAMENTAL ANALYSIS

2
CONCEPT OF TECHNICAL ANALYSIS

3
FUNDAMENTAL ANALYSIS

i) Liquidity Ratio

As can be seen above, the present ratio drops from 0.61 times in 2020 to 0.49 times in 2021,
however it maintains in 2022 which is 0.49 times same with 2021. While for the quick ratio it decrease
from 0.55 in 2020 to 0.45 in 2021 but in 2022 it increase from 0.45 to 0.47. This means that in 2020,
Digi.COM Berhad has a greater proportion of liquid assets with which to satisfy its short-term
financial obligations, as compared to 2021 and 2022. This shows that it will be a little hard for the
company to pay its short-term liabilities and the ratios are still below one. Because of this, Digi.COM
Berhad will need to take action in the near future to improve its liquidity ratio.

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 ii) Profitability Ratio

2.03
2.

Based on the calculation above, (ROA) of Digi.Com Berhad's was decreased from 14.91% in
2020 to 14.82% in 2021 and still decrease to 2.03% in 2022 ,and the decrease of 2022 are very drastic
which is from 14.82% to 2.03%. This means that Digi.Com Berhad's company might not be making
enough money to cover the cost of buying such assets because it made bad capital investment decisions.
Digi.Com Berhad’s have to be more efficient with their assets and imcrease their net income.
Based on the above calculation (ROE) Digi.Com Berhad’s has decreased from 2.02% in 2020 to
1.84% in 2021 and 0.05% in 2022. This means that in 2022 Digi.Com Berhad's did not utilize the
shareholders' capital in an efficient manner.
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 iii) Leverage Ratio

Based on the calculation above, debt ratio of Digi.com Berhad's has the highest of total debts in
2020 which is 92.60% and decrease in 2021 to 91.93%. Then it keeps decrease in 2022 which is
56.54%. It means that in year 2020 Digi.Com Berhad's is growing by taking on debt. Capital-intensive
companies often have a higher debt ratio because they put a lot of money into their assets and business.
Maybe Digi.Com Berhad’s can avoid taking on more debt to lower their debt ratio.
While the debt-to-equity ratio continues to decrease from 2020 to 2022 which is 8.36 times in
2020, 6.76 times in 2021 and 0.79 times in 2022. It shows that Digi.Com Berhad's managed to reduce
their debt-to-equity ratio by 5.97% from 2021 to 2022. It indicates that the company is making greater
use of its assets and is decreasing the amount of money it borrows from the market year after year.
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 iv) Efficiency Ratio

Based on the Inventory Turnover (ITO) above, we can see that it increases from 5.35 times in
2020 to 6.71 times in 2021 , however it decreases from 6.71 times to 0.22 times in 2022.It shows that IN
2022 the company is keeping its inventory for a longer amount of time than the time periods that were
previously measured.
While for the Total Asset Turnover (TATO) also same with (ITO) which is increase in 2020

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from 0.30 times to 0.32 times in 2021. However, it decreases from 0.32 times to 0.07 times in 2022. It
demonstrates that the entire assets of the company are not generating sufficient revenue at the end of the
year, which may be unfavorable for the company.

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 v) Market Value Ratio

Based on the calculation above , we can see that the Dividend Payout Ratio (DPR) is decrease
from 104.43% in 2020 to 97.68% in 2021. Then, it increases from 97.68% to 132.34% in 2022. It shows
that the highest DPR is in year 2022 which means a high dividend payout ratio (DPR) shows that the
company pays out a considerable amount of all its earnings as dividends to its shareholders. This can be
desirable to shareholders who are looking for revenue, as dividends are a form of passive income.
Based on the calculation of Dividend Per Share (DPS), it shows that it decreasing from 2020 to
2022 which is RM0.16 in 2020 , RM0.15 in 2021 and RM0.09 in 2022. A decreasing DPS could be the
result of reinvestment in a company's operations or the reduction of debt, but it could also be an
indication of bad earnings and be a warning sign of financial difficulty.

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TECHNICAL ANALYSIS

CHART 1; YEARLY

According to chart 1, it can be seen that there is a significant volume for selling pressure due to
the fact that many investors sell. The fact that all investors want to take profit means that this is going to
be a display or a downtrend. Beginning at the end of August and continuing through November, a
downtrend is in effect, and the range is from 38.0 to 31.0. The periods of sideways movement begin at
the middle of January 2023 and continue until March 2023.Following that is high volume, which creates
purchasing pressure. Therefore, there is a high level of demand for those shares, and as a result, the
price is either going to be sideways or slightly rise. Additionally, an uptrend may be seen between the
middle of March 2023 and the middle of April 2023. The values might range anywhere from 33.0 to
37.0. The price of a stock is said to be on an uptrend when it is consistently increasing in value over
time while also continuing to command a higher price.

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 CHART 2 : 3 MONTH

A clear candlestick chart is displayed above in Chart 2, which covers the time period from March to
June 2023. This points to a tendency of moderate intensity for Digi.Com Berhad. Because of the rise in
stock price, the chart that is located above demonstrates that the market is currently in a bullish state.
Even if there are some green candlesticks, which indicate a gain in stock price, the majority of the
candlesticks are red, which indicates a reduction in stock price. Additionally, the amount of increase in
price is greater than the amount of decrease in price. The month of March marked the beginning of the
bullish trend, which was characterized by a big drop in the stock price followed by an unexpectedly
strong rebound.
The Bullish Engulfing pattern is considered to be the most important bullish pattern that occurs in
the medium-term trend. After a lengthy downtrend, which can be seen before the month of March,
which shows a decline in stock price, this suggests a positive turnaround from the downtrend as more
buyers enter the market and boost the prices up after a long downward trend. On the other hand, this
trend was reversed in the month of March, when there was a large increase in price that lasted from the
month of March all the way through June.

CHART 3 : 1 MONTH

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CONCLUSION
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 In conclusion, the objective of financial analysis is to identify the firm's strengths in order for the
company to capitalise on these strengths, as well as to identify the firm's flaws in order for the firm to
take steps towards remediation and correction. Based on the calculation of fundamental analysis of
Digi.Com Berhad’s, we can conclude that liquidity ratio of current ratio is a bit worse because of
declining from 2020 to 2022. Short-term debt, current assets, or both can lower this current ratio.
Whatever the cause, a decrease in this ratio indicates a diminished capacity to create income. For the
quick ratio the ratio is better because it increases from 2021 to 2022. However, it still below one and
its means that Digi.Com Berhad’s lacks the quick assets necessary to fulfil all of its short-term
responsibilities. Second, profitability ratio is worse because (ROA) and (ROE) are lower in 2022.
Because of this decreasing on profitability ratio, it indicates that chances for the company have been
lost. Third is leverage ratio. Debt ratio of leverage ratio are preferable because it going lower year by
year. It is because the less a business depends on debt to build up its assets, the less risky it is. For
debt-to-equity ratio also lower risk because of lower ratio year by year. It means that Digi.Com
Berhad’s is using financial pressure to make more money. Fourth is efficiency ratio. This ratio is worse
because (ITO) and (TATO) are lower in 2022 as compared to 2021. As a result, Digi.Com Berhad’s
may not have enough current assets to meet its current liabilities, and as a result, it may run into
liquidity issues. Lastly is market value ratio. Market value of dividend payout ratio is giving more
money back to owners than it makes, so it will probably have to cut the dividend or stop giving it at all
because the DPR is over 100% in 2022. Digi.Com Berhad’s need to improve their liquidity ratio of
current ratio, profitability ratio and efficiency ratio to attract investors for interested in buying stock
with Digi.Com Berhad’s.

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REFERENCES

(2023).TradingView;TradingView. https://www.tradingview.com/chart/aKCfHPPS/?symbol=MYX
%3ADIGI

DIGI - Annual Report & CG Report - 2021. (2021). KLSE Screener.

https://www.klsescreener.com/v2/announcements/view/3532829

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 APPENDICES

CURRENT RATIO (CR)

CR= Current Asset

Current Liabilities

2020 2021 2022

CR= 1,530,560,000 CR= 1,422,614,000 CR= 4,054,746,000

2,514,173000 2,932,070,000 8,357,424,000

= 0.61 times = 0.49 times = 0.49 times

QUICK RATIO (QR)

QR= (Current assets- inventory- prepaid expenses)

Current Liabilities

2020 2021 2022

QR= QR= QR=

1,530,560,000 -137,207,000 1,422,614,000- 116,568,000 4,054,746,000- 164,358,000

2,514,173,000 2,932,070,000 8,357,424,000

= 0.55 times = 0.45 times = 0.47 times

RETURN ON TOTAL ASSET (ROA)

ROA= Earnings after tax

Total assets

2020 2021 2022

ROA= 1,220,969,000 ROA= 1,162,105,000 ROA= 763,669,000

8,186,734,000 7,839,815,000 37,539,237,000

= 0.149 = 0.148 = 0.020

= 14.91 % = 14.82 % = 2.03%

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RETURN ON COMMON EQUITY (ROE)

ROE= Earnings after tax

Equity

2020 2021 2022

ROE= 1,220,969,000 ROE= 1,162,105,000 ROE= 763,669,000

605,856,000 632,811,000 16,314,437,000

= 2.02 = 1.84 = 0.05

DEBT RATIO (DR)

DR= Total Debt

Total Asset

2020 2021 2022

DR= 7,580,878,000 DR= 7,207,004,000 DR= 21,224,800,000

8,186,734,000 8,186,734,000 37,539,237,000

= 92.60% = 91.93% = 56.54%

DEBT TO EQUITY RATIO (DER)

DER= Long-term debt

Equity

2020 2021 2022

DER= 5,066,705,000 DER= 4,274,934,000 DER= 12,867,376,000

605,856,000 632,811,000 16,314,437,000

= 8.36 Times = 6.76 Times = 0.79 Times

INVENTORY TURNOVER (ITO)

ITO= Cost of goods sold

inventory

2020 2021 2022

ITO = 733,640,000 ITO= 782,070,000 ITO= 35,456,575

137,207,000 116,568,000 164,358,000

= 5.35 Times = 6.71 Times = 0.22 Times

TOTAL ASSET TURNOVER (TATO)

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TATO= Net sales
Total Asset

2020 2021 2022

TATO= 2,432,058,000 TATO= 2,605,930,000 TATO= 2,559,271,000

8,186,734,000 8,186,734,000 37,539,237,000

= 0.30 Times =0.32 Times = 0.07 Times

DIVIDEND PAYOUT RATIO (DPR)

DPR= Amount of dividend paid on common stockholders

Net income available to stock outstanding

2020 2021 2022

DPR= 1,275,100,000 DPR= 1,135,150,000 DPR= 1,010,750,000

1,220,969,000 1,162,105,000 763,772,000

= 104.43% = 97.68% = 132.34%

DIVIDENDS PER SHARE (DPS)

DPS= Amount of dividend paid on common stockholders

No of common stock outstanding

2020 2021 2022

DPS= 1,220,969,000 DPS= 1,162,105,000 DPS= 763,772,000

7,775,000,000 7,775,000,000 7,775,000,000

= RM0.16 = RM0.15 = RM0.09

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