After sinking below IPO price, Courts Asia have delivered a good first set of results.
Net profit in 1H12/13 surged 46% yoy. Given top line also grew by 13%, Courts could have gained market share at the expense of rivals such as Best Denki whose MD described the recent going tough. Courts also seems to have achieved the fine balance of converting heavy advertising expenses into revenue growth.
Gross margin improved by c. 2% to 34%. Net profit margin also improved by 7% to 5.5%. It is noted that trade receivables increased by 9% due to Courts doing more credit sales. Its inventory increased by 9% but it may not be alarming as it was stocking up for new stores.
EPS for 2Q12/13 was S$0.077 per share. So it brings EPS for 1H12/13 to S$0.1094. Hence Price to EPS 1H12/13 is only 6.2x, with another six months of FY12/13 to run. Price to NAV (which surged to S$1.13) stands at 0.6x. (price = S$0.68)
If Courts maintain its momentum for the 2nd half of its financial year, it would vindicate the stock selection skills of the impressive roster of blue blood growth oriented value investors who took stakes during its October initial offering.
(13-11-2012, 08:41 AM)newyorkcityboy Wrote: [ -> ]After sinking below IPO price, Courts Asia have delivered a good first set of results.
Net profit in 1H12/13 surged 46% yoy. Given top line also grew by 13%, Courts could have gained market share at the expense of rivals such as Best Denki whose MD described the recent going tough. Courts also seems to have achieved the fine balance of converting heavy advertising expenses into revenue growth.
Gross margin improved by c. 2% to 34%. Net profit margin also improved by 7% to 5.5%. It is noted that trade receivables increased by 9% due to Courts doing more credit sales. Its inventory increased by 9% but it may not be alarming as it was stocking up for new stores.
EPS for 2Q12/13 was S$0.077 per share. So it brings EPS for 1H12/13 to S$0.1094. Hence Price to EPS 1H12/13 is only 6.2x, with another six months of FY12/13 to run. Price to NAV (which surged to S$1.13) stands at 0.6x. (price = S$0.68)
If Courts maintain its momentum for the 2nd half of its financial year, it would vindicate the stock selection skills of the impressive roster of blue blood growth oriented value investors who took stakes during its October initial offering.
I think got to read the latest financial statement more carefully. It was based on the former 200 million shares and not on the latest 560 million shares. In fact on many fronts, it seems inferior compared to challenger or even ecs holdings
its current market cap is almost equal to challenger's + ECS, isnt that ridiculous?
Courtsasia is a little like the property market where sometimes a newly launched project can be priced significantly higher than a nearby and slightly older condo. Put in a little more effort to look around and you can find something better value-for-money
IPOs tend to be priced better for the sellers than the buyers
Ok. Mistake on the share pool in previous calculations.
On enlarged share pool:
-- 1H2013 EPS is S$0.040
-- 2Q2013 EPS is S$0.028
So PER is 8.4x (annualising the 1H2013 performance at S$0.68). Looking at 2.3% - 3.6% projected dividend yield.
I shied away from Courts Asia due to the risks involved in its Indonesia venture and credit service. Anyway, there are better opportunities elsewhere...
But we should not deny the potential upside if all goes well. So it's all depend on individual risk-reward assessment.
It is still too early to conclude the merit of the IPO now. Maybe after 2-3 years down the road, we should be able to see its merit or the other way round...
(22-11-2012, 08:06 PM)CityFarmer Wrote: [ -> ]Courts Asia CEO, Mr. Terence shows his confidence by buying more at price of approx $0.74, a price lower than IPO price of $0.77
http://info.sgx.com/webcoranncatth.nsf/V...E00387441/$file/CourtsAsiaNoticeofADirectorChangesInInterests19000Shares.pdf?openelement
http://info.sgx.com/webcoranncatth.nsf/V...E003832B0/$file/CourtsAsiaNoticeofADirectorChangesInInterests61000Shares.pdf?openelement
A CEO who bought only 80 lots at 0.74 cts is a joke. Want to show confidence buy at least a peanut worth of the shares ($500k). Wilmar CEO bought 2600+ lots at $3.14 equivalent to $8+ mil
(22-11-2012, 10:13 PM)Bibi Wrote: [ -> ] (22-11-2012, 08:06 PM)CityFarmer Wrote: [ -> ]Courts Asia CEO, Mr. Terence shows his confidence by buying more at price of approx $0.74, a price lower than IPO price of $0.77
http://info.sgx.com/webcoranncatth.nsf/V...E00387441/$file/CourtsAsiaNoticeofADirectorChangesInInterests19000Shares.pdf?openelement
http://info.sgx.com/webcoranncatth.nsf/V...E003832B0/$file/CourtsAsiaNoticeofADirectorChangesInInterests61000Shares.pdf?openelement
A CEO who bought only 80 lots at 0.74 cts is a joke. Want to show confidence buy at least a peanut worth of the shares ($500k). Wilmar CEO bought 2600+ lots at $3.14 equivalent to $8+ mil
MC of Courts Asia is $425 millions, while Wilmar is $20 billions. So probably it is unfair to benchmark Courts Asia's CEO with Wilmar's CEO
(22-11-2012, 11:04 PM)CityFarmer Wrote: [ -> ] (22-11-2012, 10:13 PM)Bibi Wrote: [ -> ] (22-11-2012, 08:06 PM)CityFarmer Wrote: [ -> ]Courts Asia CEO, Mr. Terence shows his confidence by buying more at price of approx $0.74, a price lower than IPO price of $0.77
http://info.sgx.com/webcoranncatth.nsf/V...E00387441/$file/CourtsAsiaNoticeofADirectorChangesInInterests19000Shares.pdf?openelement
http://info.sgx.com/webcoranncatth.nsf/V...E003832B0/$file/CourtsAsiaNoticeofADirectorChangesInInterests61000Shares.pdf?openelement
A CEO who bought only 80 lots at 0.74 cts is a joke. Want to show confidence buy at least a peanut worth of the shares ($500k). Wilmar CEO bought 2600+ lots at $3.14 equivalent to $8+ mil
MC of Courts Asia is $425 millions, while Wilmar is $20 billions. So probably it is unfair to benchmark Courts Asia's CEO with Wilmar's CEO
I don't know what is courts CEO net worth but when I show confidence in a share I can use one quarter of my net worth to buy it.