TA Sector Research

OB Holdings Berhad - Comprehensive Fortified F&B and Dietary Manufacturer

sectoranalyst
Publish date: Wed, 09 Oct 2024, 10:26 AM

Background

OB Holdings (OBH) primarily manufactures fortified food and dietary supplements under various house brands, as well as for third-party brand owners. The group also provides contract packing services for products such as milk powder, tea leaves, honey, herb powder, fruit powder, and liquid chlorophyll.

IPO Statistic

The IPO entails a public issue of 120.0mn new shares and no offer for sale. Collectively, these share offers account for 30.64% of the group’s enlarged issued share capital.

Competitive Advantages

1. End-to-end Manufacturing Services

2. Longstanding Business Relationships with Customers

3. Fast-growing House Brand with a Diverse Array of Sales and Distribution Channels

Valuation

Based on an IPO price of RM0.24/share, OBH is valued at a PER of 17.1x FY24 EPS. We assign a fair value of RM0.27/share to OBH, using a PER of 12.4x for its CY25 EPS, which aligns with the simple average PER of comparable companies in the F&B sector. Not Rated.

Source: TA Research - 9 Oct 2024

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