FIGURE 1: SUNGEI BAGAN
RUBBER CO (MALAYA) BERHAD LAST 2 YEARS SHARE PRICE TREND
**analysis
based on 2019 annual report.
1.
GENERAL INTRO: SUNGEI BAGAN (SBAGAN) is one of
the main oil palm plantations in Malaysia.
2.
NOTABLE POINTS:
a. In
2019 report, The Group’s revenue was made up of sales of fresh fruit bunches
(“FFB”), dividend income, rental income and interest income.
b. for
its plantation segment, the Group owns two estates with a total planted area of
4,28 hectares. The Group only involves in sale of FFB, not involve in milling
to produce crude palm oil (CPO).
c. The
Group’s investment property in London maintained its occupancy rate of 100%. This
investment property contributed a rental revenue of RM0.67 million in the
financial year.
d. The
bulk of the Group’s investments are held in companies listed in the Mainboard
of both Bursa Malaysia and Singapore Exchange. The Company’s has positions in
Kuchai Development Berhad, Great Eastern Holdings Limited and Singapore Press
Holdings Limited.
e. The
Group also has holdings in investment funds and precious metals.
3.
IS THIS COUNTER A STRONG GROWTH STOCK?
a. REVENUE
RANGE (million): ~12.2 million in 2019 annual report, this is a low revenue
company.
b. SHARE
PRICE: from 2018-2019, share price decreasing from around RM3.50 to RM2.75.
c. EARNING
PER SHARE (EPS): earning per share in last 5 years fluctuated from -15.99 to 5.56sen
d. FUTURE
POTENTIAL/PROSPECTS: share price may drop in the next few years if earnings
continue to decrease
e. CAPITAL
EXPENDITURE (CAPEX): spending on purchase of new fixed assets is RM 7.5
million, around 1% of total assets.
4.
IS THIS A STRONG DIVIDEND STOCK?
a. DIVIDEND
YIELD: in 2019 financial year, SBAGAN declared a dividend payout of 2 sen per
share to shareholders despite making losses. The dividend yield amounts to 0.69%
only.
b. CONSISTENCY:
consistent dividend payout, last five years (2015-2019) dividends declared range
between 2 to 6 sen per share.
c. DIVIDEND
PAYOUT RATIO: N/A
5.
IS THE MANAGEMENT PERFORMANCE GOOD?
a. RETURN
ON EQUITY (ROE): in 2019 financial year, SBAGAN achieved a low return of shareholders’
equity, at -0.65%.
b. COST-TO-INCOME
RATIO: cost-to-income ratio is negative at about -551%, due to making losses.
6.
OTHER INDICATORS:
a. CASH
FLOW: cash flow is positive, around RM 63.1 million, equivalent to RM 0.95 per
share
b.
SUPPORT BY INSTITUTIONAL INVESTORS: this counter
is not well supported by institutional investors, there are only 8 institutional
investors at top 30 major shareholders list, not including insurance companies and
investment funds. Its major shareholders are KLUANG RUBBER COMPANY (MALAYA)
BERHAD (32.21%) and KUCHAI DEVELOPMENT BERHAD (26.51%).
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