A consistently loss-making company for the past 10 years. The only time the company managed to irk out a small profit was in FY18 and that was only because of a gain from financial asset investments of RM2mil. Excluding that, the company would have also end FY18 with a net loss to shareholders.
The company business in hardware and software solutions does not look great with 12 months trailing revenue of only RM1.5mil. Management has indicated that the outlook for their business will be very challenging in the near term.
Since end of 2016 it seems that the company is shifting its capital allocation to the hotel business via their 20% investment in CLI Investment Ltd which is focusing on a hotel development in Taiwan. CLI is in the process of refurbishing and converting a 14-storey apartment building in central Taipei into a hotel. In total DGB has invested a total of RM10.2mil in CLI. That being said the hotel will only be complete in the 2H of 2019. Investors need to be prepared for further net quarterly losses by DGB in the foreseeable future.
MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 6.9x PE (based on target FY18 profit of RM145mil. 9m profit is already RM106mil). PB is low at only 0.7x BV. 4Q18 results is expected to be higher than 3Q18 and last year's 4Q17.
FY19 growth will be driven by the still high demand of the new Myvi and the newly launched SUV Aruz and also the newly revamp Alza in 2H19. The recent announcement of closure and potential disposal of the loss-making alloy wheel manufacturing business alone is expected to boost the company’s profit by an additional RM20mil. I am projecting a profit to shareholder of RM170 mil for FY19 which at the current price values MBMR at only 5.9x PE.
Please go through the analyst reports and do your own analysis before making any decisions. There are 8 analysts in total covering the stock with most of them having a TP of above RM3 (all have a buy rating). The average TP for the 8 analysts is around RM3.50.
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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....
wwq84999
348 posts
Posted by wwq84999 > 2018-07-02 09:49 | Report Abuse
@funnytan...I sold all wb at 0.045..no lose liao..still profit a bit...haha..