Texchem is the parent company of Sushi King;operating chains of japanese fast food in Malaysia.
Sushi king has more than 55 outlets over Malaysia and it plans to open another 5 in the next two year. Given the fact that, it still has not penetrate the rural area, this means a huge opportunity of expansion in future. This food division contribute 7.2million net profit to the group yearly and in growing mode of 20%.
Nevertheless, the group also operating the Family Care Division: Fumakilla aerosol which is quite well known in Malaysia and have a history of more than decades. This division contributes 3.7million of net profit.
Industrial division registered a 15.2million profit while Packaging division registered profit of 5.7million.
Combining these four division would make a profit of 31.8 million. Based on closing price of Texchem at 93sen, the market value would be 124million and this make Texchem very attractive stock at PE of 4 times. Its NTA stands at RM1.33.
Given the fact that global economy is recovering, this will make Texchem benefiting from its recovery.
Texchem has a peak of RM2.10 two years ago and had bottoming at RM0.89 few months ago.Therefore, it is a safe bet for the stock at the moment.Long term buy is recommended with target price of RM1.60
Subscribe to:
Post Comments (Atom)
No comments:
Post a Comment