MFlour's business in Vietnam has great potential too - currently the second largest flour mill in Vietnam. Vietnamese's consumption/usage of flour is on the rise.
MFM is a BUY for the following reasons: 1. MFM’s fully diluted PEs of 12.0x for FY19F and 10.3x for FY20F are undemanding. A decent consumer-related company trading at low PE valuations is a rare find nowadays. MFM’s dividend yields are forecast at 4.2% for FY19F and 4.9% for FY20F. 2. After a weak FY18, MFM’s earnings are expected to recover in FY19F. We forecast MFM’s net profit to improve by 293.8% in FY19F and 16.9% in FY20F as operations normalise and contribution from the new poultry and aqua feed plants come in. MFM’s poultry division was hit by a disease and falling selling price of live birds in FY18. The group’s flour division was affected by high wheat costs in Malaysia in FY18. 3. MFM is expected to be one of the largest integrated poultry players in Malaysia in FY20F upon the completion of its poultry processing plant in Lumut in 3QFY19. This is expected to sustain MFM’s earnings growth and operating profit margin in the long term. With an installed production capacity of 240,000 of chickens per day, MFM would entrench its position as the biggest producer of broilers in the country. MFM would be involved in almost every segment of the value chain from the rearing of day-old chicks to the production of broilers.
SUPPORT LINE11h ago Malayan Flour Mills Bullish return for Malayan Flour Mills spotted at 200-day SMA Malayan Flour Mills ________________________________________ • SUPPORT LINE • Tuesday, 2 Apr 2019 8:00 AM MYT • • by fong min yuan
this year. Its gradual positive retracement has seen it cross over the 50- and 100-day SMAs in what can be seen as a return to more positive sentiment.
Sincere thanks to all, to esp Puntters , for all your invaluable contributions on Mflour. Its exciting growth prospects and potential will be great to watch in the months and years to come. It will be greatly rewarding to all its investors
My positive views :- (CHOIVO CAPITAL) A conversation with a very wise Ex-Banker Author: Choivo Capital | Publish date: Sat, 30 Mar 2019, 5:49 AM Agrees with this ex-banker on his bullish view of Mflour's flour milling business (and I quote)
“Most of MFLOUR’s chickens are sold to Texas and KFC, so they don’t lack demand. The real growth however, for me is going to come from the Flour factory in Vietnam. Vietnam is very influenced by the French, every morning they eat croissants and baguettes. There is this dish called Banh Mi that is made using baguettes or croissants. As the country gets richer, they are going to eat more of this. And to top it off, there is only one other competitor in Vietnam when it comes to flour. So, for me, I’m quite happy with it”. Aminvest also gave a very good fundamentally based report on 11 March 2019 :-
MALAYAN FLOUR (MFL MK, MFMS.KL) 11 March 2019 POULTRY AND FLOUR
Chicks rule the roost Company report BUY Gan Huey Ling, CFA gan-huey-ling@ambankgroup.com 03 2036 2305 (Initiation)
Note that Mflour have got 2 flour mills in Vietnam (1 each in the North and the South) Plus another 2 flour mills in Indonesia. Both Vietnam and Indonesia have huge populations with good demand for flour for their staple diets.
And Mflour is the 2nd biggest Flour Mill in Malaysia (after Robert Kuoks’s Federal Flour)
Combined with Mflour’s large capacity expansion in its Intergrated Poulty Segment, eg, :-
3x poultry processing capacity to be completed in 1Q of 2019 in phases (As at 31 October 2018, the construction of the additional poultry processing is approximately 83% completed (from 80k birds to 240k birds per day). Running at full capacity of 80k bird in 4Q18.
50% Malaysia fast food restaurant chicken supply come from Mflour (McDonald’s, Texas Chicken, Nando’s and Domino’s Pizza.) (source: CFO mentioned this in BFM interview) The prospects for Mlour’s business growth and profits are indeed very bright
The Rights issue had already successfully completed last year ( in December 2018 )
Raised about RM285M which had been productively utilised to expand by 3 times the production capacity of its Intergrated Poultry Segment in Lumut Perak.
Currently some shareholders and Directors are only exercising and converting some of their Warrants and Iculs into Mflour mother shares. Such conversions are positive indications of their bullish views in the bright business growth and increasing profitability of Mflour
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
sooaria
804 posts
Posted by sooaria > 2019-04-02 14:53 | Report Abuse
Engteng9688 - Yes, I agree with you , Mflour a good buy, and will shot up RM0.90 soon