Company Overview
·
VS
ranked world's top global Electronic Manufacturing Service (EMS) providers for
world-reowned office and household appliance manufacturers since year 2007 till
today.
·
Dividend
is given in every quarter result.
·
Main
business activities comprise investment holding and the manufacturing,
assembling and sale of electronic and electrical products and plastic moulded
components and parts.
Personal Comment
·
VS's
capital able to bonus issue for 2 to every 1 ordinary share.
·
Average
free cash flow yield is 4% along latest five years is not satisfied but CY in
year 2012 to 2014 is attractive.
·
Year
2014 is the year for VS to surge its revenue and net profit. Q3''2015 has a
cumulative revenue and profit with growth rate of 141% and 49% respectively.
·
Profit
margin of VS is low. Larger revenue but low net profit. So cost of goods sold
is important to identify the earning power of VS.
·
Latest
borrowing per share is RM 2.05 while cash per share is RM 0.96 so result net
debt per share with RM 1.09. Unhealthy cash company.
·
From
NTA view, VS is undervaluing seriously in past record but current price surpass
over the current NTA.
·
Trailing
PE (Taking EPS for latest 12 months in current price) is 8.79. This matches my
criteria to pick stock.
·
DY
is attractive in last year. It is higher than fixed deposit rate in bank.
·
Accounting
based earning valuation model giving intrinsic value with RM 5.21.
·
Discounted
cash flow model give intrinsic value with RM 4.98.
·
Few
of useful information disclose by VS in Annual Report.
Additional Information
·
Consolidation
of China-based company - V.S. International Group Limited (VSIG) is the main
reason of excellent revenue in year 2014.
·
VS
expand scope of services in Indonesian operation by adding plastic injection
capabilities.
·
Latest
treasury shares are 1,149,336.
·
Proposed
every 1 shares split to 5 shares with announcement on 14/7/2015 and specific
Proposals expected completed by Q3''2015 or made within one month.
·
Picture
above clearly bring us the image of high increase earning power on U.S, Europe
and China but AR2014 don't show the PBT in US and Europe.
·
Even
VS get high revenue in every quarter but business activity in Indonesia and
China still not stable due to negative PBT sometimes will obtained in quarter
result.
·
Non-current
asset just present in three countries, there are China (49%), Malaysia (41%)
and Indonesia (9%). Left 1% is other category.
·
Revenue
based on category of business activities segment is not provided in Annual
Report.
·
VS
focus their market on Malaysia, Indonesia and China.
·
Operation
in Indonesia moved to new factory in May 2015.
·
Top
two substantial shareholders who are Executive Chairman and Executive Director
are disposing many shares in year 2015.
·
Lot
of local and foreign fund listed in top 30 list shareholders.
·
Koon
Yew Yin's sharing about VS - LINK
·
RHB-OSK
target price with RM 4.50 at 2/4/2015 - LINK
·
VS
expand its business opportunity on coffee industry.
· Surprising result of PBT in every quarter of year 2015.
·
All
the quarter result in year 2015 explained mainly attributable to higher sales
and better sales mix contributed by the Malaysian operations.
Questions
1. Reason of financing
cash flow reflect positive since year 2013.
2. Is it VS proceed
large amount of loan aimed to pay off the dividend to its shareholder.
3. Price of VS after
split activity.
4. Financial ratio that
will affected after split activity.
Answers
1. Year 2013 is mainly
due to long term borrowing with amount RM 40 million while 2014 is due to short
term borrowing with large amount RM 62 million.
2. No. Dividend last
year accounted to RM 9 million, it just around 2% of total borrowing. So loan
is mainly for expansion of business.
3. Current price will expect
become RM 1.05.
4. EPS, NTA, PE, DY and
CY will be affected.
本文只供参考。共勉之。
本文只供参考。共勉之。
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