(07-01-2013, 03:02 PM)felixleong Wrote: [ -> ]I really like this counter a lot, so much better than Courts
Currently trading at close to PE 9, still an easy buy
(invested)
I also like this counter.
Beside PE, what else that attracted you to this counter?
(vested too)
I've been holding this counter for 3 years liao, I myself also member.
If looking at the numbers, the revenue and earnings growth is good
ROE also very high at over 30%
net margins have been stable over the years, meaning their competitive advantage is here to stay
I think they should be able to grow to 50 stores in msia and sg within the next 10 years
Industry wise, I think the IT consumption in SG will continue to go up, nowadays more uncles and aunties and even kids use a lot of techonology like iphones, laptop and tablets.
I'm currently only holding starhub and challenger as I hope to capture profits from this area.
I starting buying at PE 5, all the way till now still buying, its just too cheap not to buy haha
how about you, why attracts you to this counter?
(07-01-2013, 03:44 PM)felixleong Wrote: [ -> ]I've been holding this counter for 3 years liao, I myself also member.
If looking at the numbers, the revenue and earnings growth is good
ROE also very high at over 30%
net margins have been stable over the years, meaning their competitive advantage is here to stay
I think they should be able to grow to 50 stores in msia and sg within the next 10 years
Industry wise, I think the IT consumption in SG will continue to go up, nowadays more uncles and aunties and even kids use a lot of techonology like iphones, laptop and tablets.
I'm currently only holding starhub and challenger as I hope to capture profits from this area.
I starting buying at PE 5, all the way till now still buying, its just too cheap not to buy haha
how about you, why attracts you to this counter?
The company operation is well-managed base the the following
- profit margin is approx 5-6% consistently, with the highest expense on staff cost (include training) which is a strength IMO
- Its CCC (Cash Conversion Cycle) is near zero or even negative
- Asset turnover is more than 3, if excludes the excess cash asset, it is more. It means it is an asset-light business. No worry for capital raising due to expansion
Malaysia's expansion is the focus in near future.
With the intensity of competition from Courts Asia and Harvey Norman in this festival period, there is a reason for its current valuation IMO
there is so much going on in the E-retailing space that traditional bricks and mortar business will be affected by the online players.
in this scenario- especially malaysia, how is the penetration rate? Does anyone has that numbers to share ?
in the US the online retailers such as amazon are killing the market share from players such as best buy
analyst joke that best buy has become a showroom and customers go online to buy and save $
but that's the US context.
Singapore is quite different.
In US, families typical stay quite a distance from malls, maybe a 2 hours drive, so maybe weekends then they go shop together.
This encourages weekdays online shopping.
However in SG, singaporeans walk downstairs, beside their MRT got mall liao, more convenient then buying from online
Next comes to pricing, if you wanna buy a ipad, buy from store or online also same price
I believe retailers in SG will still continue to do well, no worries ^^
no wonder landlords keep upping their rental charges
Yeah the landlords are actually the big winners
you can take a look at capitalmall, doing very well
Higher rents will affect retailers but not the establish ones like challenger would can cut special deals
http://www.singaporefurniture.com/pdf/me...b%2008.pdf
you can find out more from the link attached
btw in the past courts were making losses before they got bought out, the rents killed them
for challenger, normally 80% of revenues goes to cost of goods
6% to staff pay
nly 4% to rentals, so I think rentals not that pain
http://www.challengerasia.com/Philips%20...report.pdf
old stuff but good read
The attached docs serve as good background read for the company
Let me contributes updates, base on my tracking (in FY2011)
The gross margin remains i.e. COGS remain stable around 80% since 2008 which is a good sign. The staff cost also remains stable around 6% even sales volume doubled, which shows management continue to invest on its staffs' competencies.
Rental cost is in reducing trend from 4% in 2008, with about 3.5% in 2011. This is logical with its increasing brand name and increases of sale volume per store.
The net margin increases to approx 5% in FY2011 (with 6% in FY2010). So what are the costs had been reduced to improve the net margin? There are mainly taxes and others cost. Tax reduces (from 1.2% to 1.0%) due to lower corporate tax rate. Others cost reduces (from 1.7% to 1.0%). Yes, the management is very prudent on expenses.
It seems the competitors quoted are Courts Asia and Pertama (Harvey Norman). It is the closest key competitors, but we need to take note that Courts Asia and Harvey Norman selling not only IT products, but electronic appliances and furniture which is quite a different products