*****Expansion Plan*** Apart from the level of technicality in the technology sector, expansion plan is the second utmost important factor in determining the value of a tech stock is the growth plan. The current capacity of JFTECH’s factory is 46,000 sqft, but the newly expansion factory, which is right behind the existing one would add an additional floor space of 44,000 sqft floor space. Since everyone was talking about China, let’s talk about JFTECH’s expansion in China too. JFTECH had a collaboration with Huawei, and the production line for the company is expected to start in 21Q3, which I expect they had already started the productions. In China, they are able to produce 600 test sockets in the first year and 1,200 test sockets in the second year onwards. Bear in mind that the 600 to 1,200 test sockets capacity is the bare minimum level for the company to fulfil Huawei’s orders. If required, they are able to sell more and once again, more recurring income on the test pin and elastomer’s end. If we take this into consideration, the first two years would result into approximately RM26.4 million in revenue and with 35% profit margin, the net profit would be RM9.2 million. But since the company owns 55% of the JV, ultimate net profit would be RM5.1 million – which is higher than any single quarter net profit of the company. One would also need to consider the competitive landscape in China. We mentioned the closest peer was in US, and there is no close competitor in China in terms of technical knowhow, and this is why Huawei selected them as collaborative partner. The issue with JFTECH is never the demand, but the supply end of the company itself. We could see aggressive ramping up in production level and coupled with the high CAPEX in China, one could expect this would bode well with JFTECH
Logical PE Valuation? For investors who are scrambling for low PE valuation of 10 to 15 times, surely, they are suffering from the market now. The winner would grow stronger in this quick-changing environment. The ability to finance, to raise capital, to go into joint ventures, they are all domino effect ultimately. Hence, if you are waiting for JFTECH to retrace to 30 times PE valuation, heck, or even 50 times, I do not think that would even happen.
For the past year, JFTECH is traded at the lowest level of 80 times PE valuation. My advice for investors who want to buy JFTECH, you really need to close your eyes on the PE valuation and do so. For the next 10 years, JFTECH will continue to grow strong, and stronger.
If u just look at d PE when buying share .. I advise u just put yr $ in bank ..Buying share is about investing for d future .. If a company can grow double digit every year .. you r 100 % safe ! U will make $ in d long run , for sure ! Only d matter of how much u can make ! Haha Good news on d way .. A)more pattern/new products coming up B)New factory in KL/China will start operation C)Moving to main board/more institutional buying D)Take over/joint venture target as its business is very specialise E)World moving to digital/technology which needs more chips ! Cheers guys ….
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Lch123458
87 posts
Posted by Lch123458 > 2021-07-30 12:21 | Report Abuse
Whoever can hold this stock , pls buy now !!!!
This is d lowest price … no more if u miss this !!!!