Hey guys, I created a quick & short fundamental analysis animated video on this company. I hope it helps you to know more about it! #FundamentalDaily002
QR is very good NTA: RM3.27. ASIAFLE 2.000 +0.1 (+5.3%) Quarterly rpt on consolidated results for the financial period ended 30 Sep 2020 ASIA FILE CORPORATION BHD
Financial Year End 31 Mar 2021 Quarter 2 Qtr Quarterly report for the financial period ended 30 Sep 2020 The figures have not been audited Attachments AFC - FY2021 2Q Quarterly Results Announcement.pdf 671.7 kB Default CurrencyOther Currency Currency: Malaysian Ringgit (MYR)
SUMMARY OF KEY FINANCIAL INFORMATION 30 Sep 2020
INDIVIDUAL PERIOD CUMULATIVE PERIOD CURRENT YEAR QUARTER PRECEDING YEAR CORRESPONDING QUARTER CURRENT YEAR TO DATE PRECEDING YEAR CORRESPONDING PERIOD 30 Sep 2020 30 Sep 2019 30 Sep 2020 30 Sep 2019 $$'000 $$'000 $$'000 $$'000 1 Revenue 66,605 73,304 111,257 150,903 2 Profit/(loss) before tax 14,456 8,842 15,556 20,978 3 Profit/(loss) for the period 12,683 7,099 13,314 16,825 4 Profit/(loss) attributable to ordinary equity holders of the parent 12,690 7,079 13,340 16,807 5 Basic earnings/(loss) per share (Subunit) 6.52 3.63 6.85 8.63 6 Proposed/Declared dividend per share (Subunit) 0.00 0.00 0.00 0.00
AS AT END OF CURRENT QUARTER AS AT PRECEDING FINANCIAL YEAR END 7 Net assets per share attributable to ordinary equity holders of the parent ($$) 3.2957 3.2149
• Valuation is cheap. Despite being the largest port operator in Malaysia, its valuation is still only less than half of its next biggest competitor, Westport.
• Dividend yield is high at between 5.4% to 6.6%. Given the low interest rate environment, this would appeal to a lot of dividend seeking investors.
• Cargo handled in 4Q20 is already passed precovid level. It is even higher that the pre trade war level which started in FY18. The largest port in the group is Pelabuhan Tanjong Pelepas where the 2M shipping alliance has decided to make it their Asean HQ Port. 2M consist of the 2 largest shipping companies in the world: Maersk and MSC.
• Bonus event. Potential monetisation of Port business via IPO. The group is looking to raised RM4bil via IPO. Assuming the amount is from the sales of up to 40% interest in the port business, this values the port business at RM10bil which is way above the current market cap of only RM2.5bil. This does not include their 38% holding in Malakoff (valued at RM1.8bil), 31% of Gas Malaysia (valued at RM1bil) and their Engineering business which is currently the main contractor for MRT2 (via JV with Gamuda). https://www.thestar.com.my/business/business-news/2020/10/23/mmc-mulls...
With Biden being the new President of US, you can expect him to overturn Trump’s America First Policy. This will make it easier for US to trade with other countries including Europe and China which will increase global trade and benefits ports operators like MMC.
If one looks at asiafile...then interest should also be there in CWG....both in the same industry...much cheaper tightly held...after covid...should perform better..... Watch and u will c a hidden buyer..... Dont play contra.....surely burn your fingers
Asiafile should consider a takeover on CWG, monopolise the stationary industry and become a stationary giant... just like how Panasonic did a takeover of Sanyo in 2009 , panamys profits were only 50million in 2009, few years later 100+million..
during the early days dividend around 12 to 15 sen since last year dropped to zero and now declared 1.5 sen.therefore ppl lacks confidence in this counter
As a stationery company, Asia File faces the threat of digital disruption. The Group has recognized this by not expanding into this sector. Instead, it diversified into food wares and consumer wares that in 2023 accounted for 16% of the Group revenue.
Both the stationery and food/consumer wares businesses are profitable and generating good returns.
The challenge is that about 2/3 of its capital is tied up in non-operating assets that generated low returns. This has resulted in overall low returns for the Group. It would have to depend on new ventures to rectify this. The Group is financially strong and this will give it time to deliver these.
My valuation showed that it is not a value trap. There is sufficient margins of safety to invest at the current market price. But you need to have a long-term view.
@Dehcomic01 thank you for the insights, can you share more info about their food and consumer sector? what is their products or brands? I can't find related infos through their official website
Ever since coming across an article suggesting that the packaging sector would benefit from the growth of online retailing, I have been hunting for packing companies. My search went beyond Bursa and included US. Why the US? In 2023, the total return (dividend + capital gain) for the Bursa KLCI was about 3%. The S&P 500 achieved 26%. Even accounting for forex losses, you can see why the US is better. But this does not mean buying blindly. You still need to do fundamental analysis. Take the example of Avery. This is NYSE a global materials science and digital identification solutions company. Despite its acquisitions, its revenue only grew at 4.4% CAGR over the past 10 years. While ROE and net margins have been trending up, there were no improvements in other operating parameters, I think that the stock is fully priced. https://i.postimg.cc/C1cQgNs2/Avery-Dennison.png On the other hand, Bursa Asia File has diversified into food packaging. Not exactly sexy, but it has a margin of safety. The only concern is how long it will take for the market to re-rate. If I can find an equivalent US packaging company, that would be priority. In the absence, Asia File is there. https://www.youtube.com/watch?v=CPtsfLAnaEc
2/3 assets not earning anything and you still argue not a value trap? are you joking? Dividend so low even earning so much, the owner got bulk of shares and not willing to share good div with investors.
We have read stories about how some of the Malaysian media groups “suddenly” have to close down their newspaper operations due digital disruption. Digital disruption does not happen overnight and you would have thought that companies would have years to prepare for this. One good example of a company that took step to anticipate digital disruption is Asia File. This is a global filing company. We all know that digital technology is changing the way we store documents and the demand for files will continue to decline. Asia File recognized this and for the past decade, it had stopped expanding its filing business. Instead it diversified into food and consumer wares about 7 years ago. This have given it a possible non-stationery growth path. But it is not clear whether this can be as big as the stationery business. So the company is still looking for other ventures. This good story is that its stationery business is a cash cow and it is still not clear how long it will take for the demand for files to become negligible. In the meantime, the company is using the cash and time to build up replacement businesses. I am sure you will not read any story about this company suddenly closing down the filing business due to digital disruption. If you want to know more about this, go to page 21 of INVEST https://notice.shareinvestor.com/email/newsletter/invest/pdf/Vol203-Invest-19Apr.pdf
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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....
EngineeringProfit
20,578 posts
Posted by EngineeringProfit > 2018-08-05 06:33 | Report Abuse
Interesting....