Investor on the Street

ABLEGLOB (7167): Capable local company, great Global ambitions

Effulgence
Publish date: Sat, 02 Jul 2022, 11:57 AM

ABLEGLOB (7167) is a Main Market company which is in the Consumer Products segment. 

ABLEGLOB’s old name was JOHORTIN.

(Not to be mistaken with ABLEGRP (7086) That is another company)

 

ABLEGLOB is a low-profile company that few of us have heard of. 

Its business is in manufacturing Tin Cans & Dairy Products.(like biscuit tins & condensed milk) 

Dairy Products revenue is more than Tin Cans.

ABLEGLOB also exports its products, e.g. Mexico. 

 

 

Is ABLEGLOB selling at cheap price now?

 

1. Share price you pay now is more than Net Asset per share. 

ABLEGLOB' share price is RM 1.27, whilst its net assets is about RM 1.22.

 

2. Business has improved since 2012 may have been reflected in share price.

ABLEGLOB' revenue & profit was highest in 2019, but highest share price was 2020. 

Revenue increased in 2021, but profit decreased because raw material price increased & high freight cost. 

 

3. Cash generated declined despite increased revenue in 2021. 

This may explain the greatest concern on ABLEGLOB. Cash generated from operations is on downtrend on year-on-year basis since 31 March 2021 quarter (except 30 June 2021).

 

4. Executive Director’s wife & Chairman’s wife bought back shares recently.

Executive Director Mr. Ng Keng Hoe (Huang Qinghe)’s spouse Mdm. Lai Shin Lin had purchased shares from open market around RM 1.25-RM1.30 via Able Perfect Sdn. Bhd. 

Chairman Datuk Kamaludin Bin Yusoff’s spouse Datin Fawziah Binti Hussein Sazally had purchased shares from open market at RM 1.2318 via Genting Perwira Sdn. Bhd. 

Usually, this is a vote of confidence that the company is undervalued.

 

5. Low Publicity.

ABLEGLOB is not a heavily-promoted stock. See how many bloggers & analysts mention ABLEGLOB. How many interviews are with ABLEGLOB management?

 

The cashflow concerns may worry investors. 

ABLEGLOB’S total borrowings increased almost 100% from 2020 to 2021 to grow its business. 

ABLEGLOB became net debt.

But, ABLEGLOB holds a proud record of suffering only one loss in any quarter since 2012 (except 30 June 2014)

And, ABLEGLOB has been distributing dividends for at least 10 consecutive years. (and earlier)


 

I don't have shares in ABLEGLOB. Looking forward to buy this stable growth company when share price is under RM0.95.


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