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Overview
Financial Highlight
Headlines
Business Background LKL International Bhd is Malaysian company which is principally engaged in the provision of medical and healthcare beds, peripherals and accessories. The company’s operating segments are Manufacturing and Trading. The Manufacturing segment is involved in the manufacturing of medical and healthcare beds, medical peripherals and accessories and the Trading segment is involved in trading of medical peripherals and accessories. The company serves its products to various end users such as hospitals and medical centers, as well as other healthcare-related facilities including clinics and specialist institutions. LKL operates its business in Malaysia, Africa, Asia, Europe and other regions. Most of its revenue is earned from Malaysia.
  Shinnzaii QR may still red, news profit may reflect in upcoming quarter, not this quarter...hold it until next quarter 03/08/2018 9:03 AM Bratt No need to buy LKL for the next 12 months. Now with poor government budget, hospitals are forced to squeeze. Hospital beds must be used longer than the normal (instead of buying new ones). And maintenance must be cut. 18/10/2018 10:40 AM FairTalk Already reached 12 sen and volume traded very low. Hope it will rebound soon. 05/12/2018 10:12 AM commonsense When it first listed its share to the public back in May 2016, most investors were bullish of the company’s prospect (in particular the potential profit growth) given the amount of budget allocated by the government for healthcare averaging RM25bil in FY16 and FY17. More importantly was the government’s commitment to build new hospitals while improving facilities of existing government hospitals which should bode well for LKL (which main business consist of supplying medical beds). Surprisingly, the financial performance of the company fell when compared to their performance prior to the IPO. In FY15 the company managed to record a revenue of RM39mil and a profit of RM6mil. Upon its listing, FY17 (being the first full year performance) only managed to record a revenue of RM33.8mil and a profit of RM4.4mil decreasing by 13% and 27% respectively. In FY18 it was worse as the company revenue fell to less than RM30mil and recording a loss of RM1mil. FY19 seems to be a bit better than last year but still far from the performance prior to the IPO (1H19 Revenue RM17.3mil and Profit RM140k). Even if the company managed to deliver a PAT of RM1mil in FY19, it would mean that the company’s is currently being valued at 45x PE which is high given the doubt of the LKL’s ability to grow the profit. The company’s balance sheet is ok with debt of RM7.8mil and cash of RM10.3mil. At an NTA of 14 sens per share the company is currently trading at around 0.9x PB. If you are looking to diversify your portfolio outside of LKL International (due to its weak earnings growth outlook) I would recommend you to look at MBMR. MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 6.7x PE (based on target FY18 profit of RM145mil. 9m profit is already RM106mil). PB is low at only 0.6x BV. 4Q18 results is expected to be higher than 3Q18 and last year's 4Q17. For FY19 growth will be driven by the still high demand of new Myvi and the newly launched SUV Aruz and also the newly revamp Alza in 2H19. I am projecting a profit to shareholder of RM160 mil for FY19 which at the current price values MBMR at only 6x PE. Please go through the analyst reports (https://klse.i3investor.com/servlets/stk/pt/5983.jsp) and do your own analysis before making any decisions. Most analysts have a TP of above RM3 for the company with Hong Leong being the lowest at RM3.13 and Maybank the highest at RM4.50. Good luck. 17/01/2019 4:33 PM uncle ykk https://www.theedgemarkets.com/article/lkl-international-inks-two-distribution-agreements-taiwanese-medical-devices 12/04/2019 10:11 PM uncle ykk KUALA LUMPUR (April 12): LKL International Bhd has clinched two agreements to distribute medical appliances from a Taiwan-based company in Malaysia. According to two bourse filings, the group said its wholly-owned subsidiary Medik Gen Sdn Bhd (MGen) had entered into the agreements today with Taiwan-based Qisda Corporation’s BenQ Asia Pacific Corp (BenQ), and BenQ’s unit Lily Medical Corp (Lily). Both distribution agreements are to end on March 31, 2021. Under the agreements, MGen will distribute BenQ’s medical display devices, related spare parts and software, and Lily’s disposable medical devices and related spare parts. Both Lily and BenQ have allowed MGen to use their trademarks and logos to promote and sell these products. LKL said the agreements complement its existing business in the healthcare sector. “With the award of the distributorship, the group will not only be able to broaden its products offering to its customers via the distribution of the products but also to expand its customer base in [Malaysia]. The distributorship is expected to contribute positively to the future financial performance of the group,” it said. The two distributor agreements are not expected to have a financial impact on the group’s earnings, net assets, gearing levels or substantial shareholder’s shareholdings for the financial year ending April 30, 2019 (FY19) Meanwhile, in another filing, LKL said MGen had entered into a shareholders’ agreement with Agrow Corporation Sdn Bhd on April 10 to set up a joint venture company to promote, market, distribute and sell selected branded medical devices within Malaysia. The proposed name of the JVCo is LKL Agrow Healthtech Sdn Bhd and it is expected to commence operations by three months from the date of the agreement. The initial capital of the company will be RM500,000, comprising 500,000 ordinary shares, with both party subscribing to half of those shares each. MGen’s subscription of the shares will be funded internally. The counter closed unchanged at 12 sen — with 110,000 shares changing hands — giving the group a market capitalisation of RM51.46 million. 12/04/2019 10:11 PM Cobia Uncle YKK 1) is revenue for this stock growing for 2 consecutive quarters? 2) do they have lots of debt? 3) Malaysia's medical segment is not expanding much, do u know if they have income from other countries? 12/04/2019 10:28 PM uncle ykk hi Cobia, 1) last two quarters showed increase in revenue however low profit due to high admin fees. In the announcement dated on 30 july 2018, the company received USD 2.8m contract from Uganda to supply bed/medical device from 1 August 18 to 1 August 2019. However this was not showed in the last quarter report. If the deal is ongoing , this shall contribute to the up coming report. 2) Gearing ratio is low. RM6m loan and cash RM9m. 3) From the report, local market is their main customer. Demand for healthcare services is Malaysia is growing. There are not many health care provider in Malaysia. LKL currently traded below IPO price, is a good entry price now. 12/04/2019 11:20 PM Cobia uncle ykk, thanks for recommending this stock. it seems to have similar trend with VIS 0120. I can see management has taken good initiative to expand the business portfolio. Moving into the medical equipment segments seems to be the right move to increase revenue. With the strong balance sheet and increasing revenue, it looks very promising for mid term investment. 15/04/2019 4:20 PM uncle ykk Hi cobia, This stock is for mid and long term investment. At current price, I’m looking at 50% gain in 2 years. 15/04/2019 5:16 PM FairTalk Need to be very patient to invest in this counter. Noted that the company or its subsidiaries have entered into agreements to distribute medical devices. We have to wait to see whether the results will be good. In the meantime the main product of the company is production and selling of hospital beds however hospital beds unlike consumer products are slow moving as hospitals do not change their beds frequently. Someone has commented that currently the price of this counter is below the IPO price if it is the case then will be very disappointment for the investors/shareholders who have invested in the IPO and have high hope on the company. There are also other healthcare or healthcare related companies in the Bursa and some of them are heavyweights with different pricing, prospects, risks and market etc. It is really up to you how you want to evaluate this counter and whether it is worthwhile to invest in it. Best Wishes. 19/04/2019 3:18 PM Cobia the sales of medical equipment has seen growth in the past quarters. that is a good indications that the management is doing the right thing to increase the revenue. the price is almost at the bottom now. Quarterly report has been black for the past 3 quarters, perhaps it is time to pickup now. 30/04/2019 10:53 AM FairTalk If you are a investor who have invested in this IPO will you be disappointed with this investment. 03/05/2019 11:46 AM  |
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