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Author: Tan KW   |   Latest post: Wed, 16 Jan 2019, 06:53 PM

 

COMMENTS ON BRIGHT PACKAGING INDUSTRY BERHAD (9938) - louisesinvesting

Author:   |    Publish date:


Thursday, January 10, 2019

 
FIGURE 1: BRIGHT PACKAGING INDUSTRY BERHAD LAST 5 YEARS SHARE PRICE TREND

**analysis based on 2018 annual report.
1.       GENERAL INTRO: This counter core business is manufacturing aluminium foil paper packaging for tobacco, liquor & confectionery industries. Minor segment is offset printing of folding carton for fast food and confectionery industries.
 
2.       NOTABLE POINTS:
a.    surge in crude oil price increases production cost components, including raw materials like paper pulp (paper board), vinyl acetate monomer (base material for adhesive), aluminium ingot and energy
b.    key customer of tobacco packaging is Philip Morris, for household goods and beverages segment, main customers include Johnnie Walker, Chivas Regal, Diageo, Unilever and Procter & Gamble, exporting to countries include Germany, UAE, Australia, Korea, India, Pakistan, China , Thailand, Indonesia, Singapore, Philippines, Vietnam, Hong Kong and Taiwan.
c.     focus on premium quality tobacco and liquor packaging segments, which has high barrier of entry due to involve high capital investment, help to prevent competitors from entering the market.
d.    tobacco packaging sales made up ~99% of company revenue
 
3.       IS THIS COUNTER A STRONG GROWTH STOCK? 
a.       REVENUE RANGE (million): ~54.2 million in 2018 annual report, this is a below 100million revenue company.
b.      SHARE PRICE: last few years share price on decreasing trend, dropped from ~RM0.85 in 2013 to current share price of ~RM0.18.
c.       EARNING PER SHARE (EPS): earning per share in last 5 years were fluctuating, EPS were 1.7, 0.52, 0.89, -1.11, -1.44 sen per share, respectively, making losses in 2 out of 5 years.
d.      FUTURE POTENTIAL/PROSPECTS: as production and raw materials costs continue to rise, depend on cost control measures and technology advancement to remain competitive
e.      CAPITAL EXPENDITURE (CAPEX): spending on purchase of new fixed assets is 1.5 million, around 1.2% of total assets.
 
4.       IS THIS A STRONG DIVIDEND STOCK?     
a.       DIVIDEND YIELD: in 2018 report, no dividend payout declared
b.      CONSISTENCY: no dividend payout declared in last five years
 
5.       OTHER INDICATORS:
a.       CASH FLOW: cash flow is positive, around 39.5 million
b.      SUPPORT BY INSTITUTIONAL INVESTORS: there is no presence of institutional investors at top 30 major shareholders list.
 
Disclaimer: The content of the blog posts are for sharing purpose only. Readers are encouraged to carry out further research and analysis as well as follow up latest update information before making any investment decisions.

 
 
 

 

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