Financial Highlights

The following table sets out a summary of the historical consolidated financial information of the company Group for the FYE Under Review:

• The revenue grew from RM 76 million in FYE 2021 to RM 113 million in FYE 2023, but dropped to RM 104 million in FYE 2024 due to lower revenue from boutique and departmental store channels.
• The gross profit margin rose from 58.06% in FYE 2021 to 61.94% in FYE 2022, then slightly decreased to 61.71% in FYE 2023 due to higher discounts on slow-moving stocks and a greater proportion of sales from boutiques in premium outlets. It then rose to 62.82% in FYE 2024.
• The PAT margin increased from 5.21% in FYE 2021 to 21.84% in FYE 2022, but decreased to 18.41% in FYE 2024.
• The gearing ratio is 0.07 in FYE 2024, which is below the benchmark range, indicating that the company has room to increase debt and bring the ratio within a reasonable range. (A healthy gearing ratio range is between 0.25 – 0.5)

Major customers and suppliers

Major Customers

As a retailer of women’s handbags, footwear and accessories, the company’s customers are primarily cash and carry customers at boutiques, departmental store counters and e-commerce platforms. The sales contribution from each customer as a percentage of the company Group’s revenue is negligible. However, there are amounts due from financial institutions for debit and credit card transactions, as well as amounts due from departmental stores and third-party e-commerce platforms in relation to sales generated from these distribution channels.

Major Suppliers

Below is the company Group’s top 5 major suppliers for finished goods for FYE 2024:

The company does not enter into long-term agreements or arrangements with suppliers as purchases are confirmed on a purchase-order basis. Although ASSB is a major supplier of finished goods, the company Management is of the view that the company Group is not materially dependent on ASSB and/or any of the major suppliers, as there are various other suppliers in the market that can offer similar quality products and services at competitive rates and can serve as replacements to the current list of suppliers.

Industry Overview

Fashion refers to the styles of clothing and accessories worn by groups of people at any given time. In Malaysia, the fashion industry is a multi-billion RM sector encompassing the design, manufacturing, distribution, and sale of apparel, footwear, handbags, and accessories. It includes fashion and design organizations, along with creative talents such as models, hair stylists, make-up artists, photographers, and agents, forming a vibrant ecosystem. The industry engages customers through extensive retail networks, marketing, and advertising, with shopping malls offering a wide product range that allows comparison of brands, designs, and prices. Periodic sales and promotional events further boost retail activity. Additionally, social media plays a vital role in both selling fashion and forecasting trends, with retailers showcasing new arrivals through updates, product descriptions, and celebrity endorsements.

Fashion retailers in Malaysia generally operate in vertical markets, which refer to retailers offering products that are related to fashion. Vertical markets are more focused and targeted at a specific group of consumers. The distribution channels for the fashion industry can be in the form of physical retail stores (also known as brick-and-mortar stores) and/or online stores.

The fashion industry in Malaysia has been substantially influenced by the penetration of premium and luxury fashion brands from around the world and this is anticipated to continue. Fashion retailers are increasingly positioning shopping as an intrinsic part of a desired customer lifestyle and as such, aligning their strategies to match customers’ expectations. The fashion market is projected to grow along with an increase in the population, with companies excelling in global brand management, enhanced shopping experiences, and multichannel strategies poised for success. Fashion is expected to emerge as a leading category for online shoppers, driven by the rise of affluent female customers and increasing internet accessibility. As online shopping becomes integral to lifestyles, the online fashion market is anticipated to thrive in the coming years.

The projected revenue of selected fashion segments of the fashion industry in Malaysia between 2023 and 2027 are as follows:

• accessories – RM18.33 billion to RM24.34 billion, recording a CAGR of 7.3%;
• women’s footwear – RM4.64 billion to RM6.22 billion, recording a CAGR of 7.6%;
• women’s handbags – RM3.56 billion to RM4.50 billion, registering a CAGR of 6.1%.

Source: Infobusiness Research

Future plans and strategies for CARLO RINO GROUP BERHAD

The company’s business strategies and future plans are set out below:

1. Establish new Carlo Rino flagship boutique
2. Refurbishment its boutiques and counters at departmental stores to attract customers and drive sales growth
3. Acquisition of properties to be used as show galleries
4. Overseas expansion via online e-commerce platforms
5. Upgrade its IT infrastructure

MQ Trader View

Opportunities

1. The company has a multi-channel distribution network
2. The company undertakes continuous D&D efforts to stay aligned with the latest trends and designs

Risk

1. The company may encounter supply chain interruption from suppliers of their products
2. The company may face challenges in securing retail outlets at prime locations and renewal of the terms of tenancies and consignment arrangements
3. The company is relying on external third-party logistics and courier service providers for product delivery

Click here to continue the IPO - Carlo Rino Group Berhad (Part 1)

Looking for 3x cash & 2x shares trading limit? Get started now!

​https://bit.ly/mqtatrade

Community Feedback

We encourage traders to try out and evaluate the MQ Trader system and provide us feedback on the features you like to see in the system. We have received many positive feedbacks so far, and we are currently compiling and reviewing them for possible inclusion into the next release of the system.

We would like to develop this system based on community feedback to cater for community needs. Thanks to all those who have provided valuable feedback to us. Keep those feedback coming in!

Disclaimer

This article does not represent a BUY or SELL recommendation on the stock covered. Traders and Investors are encouraged to do their own analysis on stocks instead of blindly following any Trading calls raised by various parties in the Internet. We may or may not hold position in the stock covered, or initiate new position in the stock within the next 7 days.

Join us now!

MQ Trader stock analysis system uses Artificial Intelligence (AI), various technical indicators and quantitative data to generate accurate trading signals without the interference of human's emotions and bias against any particular stock. It comprises trading strategies which are very popular among fund managers for analysing stocks.

MQ Trader stock analysis system is SPONSORED for MQ Trader members. To use this amazing tool, you can sign up via MQ Trader Sign Up!

Contact us

Please do not hesitate to contact us if you have any enquiry:

Facebook: https://www.facebook.com/mqtrader

Instagram:https://www.instagram.com/mqtrader

MQ Chat: https://messenger.i3investor.com/m/chatmq

YouTube: https://www.youtube.com/channel/UCq-26SGjlQTVQfO7DoEihlg