Focus Point Holdings (FOCUS POINT | 0157)

Last Price: RM0.83 | Technical Call: BUY

Company Background. Focus Point Holdings (Focus Point) primarily operates professional eye care centers, trades eyewear & eye care products, and manages both franchised eye care centers and food & beverage (F&B) outlets in Malaysia. The group focuses on two main business segments: (i) optical and (ii) food & beverage. As the largest optical retail chain in Malaysia, Focus Point's key brands include Focus Point, Focus Point Signature, Whoosh Eyewear, Opulence, and Optometris Anggun. In the F&B segment, the group also runs bakery outlets under the Komugi brand.

Prospects. (i) To strengthen its market leadership in the optical segment, the group will expand its nationwide presence through strategic outlet openings and targeted marketing initiatives. With over 190 outlets, Focus Point remains committed to sustaining its growth by focusing on high-impact locations, (ii) For the F&B segment, the group plans to expand Komugi Bakery into residential areas and introduce new products for retail and corporate customers. Building on its FY24 profitability turnaround, the group will focus on enhancing efficiency to drive sustained growth, and (iii) The recovery of tourism, fueled by increased flight capacity and visa exemptions, is expected to boost tourist spending, driving further expansion and momentum in the optical and F&B segments.

Financial Performance. In 9MFY24, Focus Point reported higher revenue of RM209mil (+11.6% YoY) with a PAT of RM24mil (+21.8% YoY). This was mainly attributed to higher sales achieved by both the optical and F&B segments, as well as lower overall operating and overhead costs.

Valuation. Focus Point is trading at an FY25F P/E of 9.5x, which is lower than the Bursa Consumer Index's 16x. By comparison, Japan-based Jins Holdings, an eyewear retailer that designs, manufactures, and sells eyeglasses, sunglasses, and other accessories, trades at a much higher FY25F P/E of 24.4x.

Technical Analysis. Focus Point may rise higher after breaking above the RM0.825 resistance and reaching a new 52-week high a few sessions ago. Given that the 20-day EMA has remained above the 50-day EMA since the bullish crossover in late November 2024, upward momentum appears to be in place. A bullish bias may emerge above the RM0.825 level with stop-loss set at RM0.77, below the 50-day EMA. Towards the upside, near-term resistance level is seen at RM0.95, followed by RM1.00.

Entry: RM0.825-0.83

Target: RM0.95, RM1.00

Exit: RM0.77

Source: AmInvest Research - 5 Feb 2025