FOCUSP (0157): Main market; Consumer products & services

We expect 4Q23 to register better numbers given expanded client base built over the last few quarters as well as higher rebates for optical segments. HLIB reiterates a BUY with TP of RM1.03 based on unchanged 14x PE multiple of mid-FY24 EPS.

We remain confident on FOCUSP’s scalable business model as we reckon that both optical and F&B segments are poised to continue their growth trajectories with the group’s brand equity and popularity of Komugi (a premium Japanese bakery) products. Management is optimistic that the ratio of optical to F&B revenue at 80:20 currently will gradually shift to 70:30 or 60:40 in the next 2-3 years.

Falling wedge formation and anticipate a technical rebound from a steeply oversold level. A successful breakout above 0.75 downtrend line hurdle will spur greater upside towards 0.79-0.85 territory.

✅Current price: RM0.715

✅Entry: RM0.69-0.70-0.72

✅Resistance: RM0.75-0.79-0.85

✅Cut loss: RM0.68

✅FY12/24 P/E: 9x (vs peers’ P/E: 20x)

✅FY12/24 yield: 4.2%

✅Risk profile: Low

Source: Hong Leong Investment Bank Research - 5 Jan 2024