Posted by 10154899906070843 > 2019-01-23 14:42 | Report Abuse

Comparing DKSH with another similar company Harrisons holdings I cant help but realize a few things:

1. both the companies are at a terminal value, the profits and revenues are both stagnating, with no growth triggers in place other than a population growth rate (and inflation rate). Basically, if you look at both companies, if you put inflation, GDP and interest rates into consideration, DKSH and Harrisions have basically been the same company. Stuck.

2. Both companies further exacerbate this by paying a huge amount of their profits as dividends. Your only play in buying these companies is not for the share price increase, but a measly 3.75% and 5.33%, as the money coming out as dividends show that they find no better way to invest in company growth.

3. There is however a silver lining. DKSH made an offer of 480 million for Auric. DKSH is punished by their debt fueled purchase of auric, and the market is punishing them as such. Whether this is unfair punishment, or a brilliant play, remains to be seen. I dont know how profitable the manufacturing of melange can be, or if DKSH can pivot its growth by doing VSS of unnecessary double entry of staff, but definitely doing something is better than doing nothing.

4. Anyone who buys DKSH just for a measly dividend is better off not investing in stock market. Anyone who buys a stock just because it seems lowly priced without understanding the long term effects of auric revenue/earnings generation is just a speculator.

Someone who can understand the logic of a company with a networth of 530 million paying 480 million for its value proposition growth in revenue and earnings in 5-10 years? Now thats called investing.

Posted by qqq3 > 2019-01-23 15:20 | Report Abuse

good analysis 1015....

DKS, Harrisons, Unilever.....old model unable to generate growth already....It either adapt or slow death for them....


old marketing is dead......everyone needs new marketing....

Posted by TM1166 > 2019-01-23 16:28 | Report Abuse

The price will just go up...

Posted by LuckyG > 2019-01-23 18:36 | Report Abuse

Sure it will

Posted by PotentialGhost > 2019-01-23 21:27 | Report Abuse

If right issue 481m to buy a PE 23 company and no guarantee profit you guy will know what is gg , mean year return only 4.3% , put your money in bank more better .

Posted by 10154899906070843 > 2019-01-23 22:45 | Report Abuse

maybe yes maybe no, do you know how much auric earned in singapore the last 10 years growth? if you do know its a simple of addition and subtraction and estimation. In either case private limited companies dont normally show their P&L to just about anyone,

maybe potential ghost knows how much auric 5 year equity growth is worth and can share the info to i3 community? I'm sure you have read through it extensively right?

Posted by lazycat > 2019-01-24 00:19 | Report Abuse

snake telan oliphaunt , sure right issue , no bank will loan them 480m for this acquisition.

https://www.malaysiastock.biz/Corporate-Infomation.aspx?securityCode=5908

if they successfully get loans from banks , 4-5% interests of 480m every year already equal to 40% of their current annual profits.

auric pacific? scs butter , buttercup spread? business very competitive , profit margin sure low.

myb the management know better and somethings i not aware of , but i just don't see the benefit of this acquisition..

major shh 74% and institutional funds 18% , only 8% is hold by public , so.. any right issue probably will get approve.

Posted by cheoky > 2019-01-24 16:05 | Report Abuse

Low free float. Post big holder clearance, any positive news should bring dksh north up. Dksh is deeply entrenched in msia retail.

Posted by villa1668 > 2019-01-25 09:10 | Report Abuse

Look like a bit hard to go up, because of low margin, people no interested?

Posted by sapurakencana > 2019-01-28 15:05 | Report Abuse

Becareful Stockbit strong recommanded RM1.80

Posted by sapurakencana > 2019-01-28 15:21 | Report Abuse

Pls take note due to the DKSH holding company & institution investor already hold more than 75% of paid up capital,i guess there are only 40000 Lot (1000/lot) flouting / trading in the Market.

Posted by sapurakencana > 2019-01-28 20:59 | Report Abuse

Now everybody concern about loan 485 mil to acquire Auric Pacific,if from the holding company point of view,if this acquisition is worthy to growth their asia business,they dont mind to invest large amount at the right time.2.If we convert RM485mil into swiss dollar,it only 120mil.For holding company share price Swiss 72 dollar(RM300 per share),this capital expenses only 10 persent of its annual revenue. This happen to Digi when Digi Swiss (Holding) ciompany acquire majority share from Berjaya,less than 5 years ,the return is few 100% from the original investment. Reconsider before invest.take your own risk

Posted by cheoky > 2019-02-07 13:47 | Report Abuse

Need to retrench and reduce cost during integration. At least no cash call

Posted by firehawk > 2019-02-08 22:57 | Report Abuse

From the circular to shareholders,
Estimate PAT Auric Pacific(M) for 2018 ~ 25m
DKSH buying price = 485m
Estimate return of investment = 25/485 = 5.15%

DKSH funds the buying cost entirely by bank borrowing, bank interest would eat up almost all the profit .... in near term, also facing risk of good will /impairment ....

may be the expansion is good for long term .....

Posted by Hafid > 2019-02-11 12:33 | Report Abuse

who know what Auric Pacific is doing

Posted by cheoky > 2019-02-11 22:59 | Report Abuse

But I know definitely lippo group is short of cash recently. The seller... Hopefully is a bargain picked up by dksh.

Posted by sapurakencana > 2019-02-14 15:50 | Report Abuse

now everybody keep on goreng cents counter ignor DKSH very sad.

Posted by Najib Zamry > 2019-02-15 10:10 | Report Abuse

DKSH result will be out anytime with final dividend announcement. Stay tune.

Posted by LuckyG > 2019-02-15 15:24 | Report Abuse

sold . ty

Posted by Icon8888 > 2019-02-15 15:30 | Report Abuse

I thought we are supposed to wait for 4 ?

Posted by LuckyG > 2019-02-15 21:39 | Report Abuse

volume very thin .

Posted by cheoky > 2019-02-17 12:03 | Report Abuse

Keep for wife n daughter. More they shop more they earn with dksh.

Posted by moneykj > 2019-02-20 15:09 | Report Abuse

Wow

Posted by sapurakencana > 2019-02-20 16:15 | Report Abuse

DKSH will back to RM3 soon because look like no resistant between RM2.60-RM3.20.Plus if quarter result OK and EGM approved Auric Pacific,this is the bonus for this counter.Still remember what i said RM486 mil is a peanut in the eye of DKSH holding.They are eyeing economic boom in 3 year time.

Posted by BowlingCosmo > 2019-02-20 16:18 | Report Abuse

understood. will keep a close watch on dksh

Posted by myuptownboy > 2019-02-21 11:05 | Report Abuse

wow... something big is coming!

Posted by moneykj > 2019-02-21 11:21 | Report Abuse

Rm3 before q

Posted by factorrumour > 2019-02-25 17:33 | Report Abuse

gong hei gong hei

Posted by FLINV > 2019-02-25 19:57 | Report Abuse

Does DKSH QR consider good or ...?

Posted by cheoky > 2019-02-25 21:06 | Report Abuse

good result. believe in msia consumer section, should buy more and hold long long.

Posted by 4444 > 2019-02-25 21:22 | Report Abuse

Profit down 32%. Limit down tomorrow? Pity newbies think 2.72 cheap ctr?

Posted by cheoky > 2019-02-25 21:34 | Report Abuse

aiya. u dont newbie la. i trying to sell my ticket on hand ma. dont burst it pls.

Posted by sapurakencana > 2019-02-25 21:59 | Report Abuse

Profit is down,but cash in hand keep on increase to RM100mil,this is the ability of the swiss company to generate cash in hand.On the other hand,they not even ask money from us after EGM,this is what we call good company.

Posted by cheoky > 2019-02-25 22:52 | Report Abuse

err... kampung from swiss? bro! long time no see!

Posted by yip_8988 > 2019-02-26 10:11 | Report Abuse

Ha Ha Ha, looking the share price the stupid sellers selling the share like company going to bankrupt .

Posted by sapurakencana > 2019-02-26 10:22 | Report Abuse

THIS IS WHAT WE CALL PANIC SELL WHEN OTHER CONDITION REMAIN UNCHANGE

Posted by Choivo Capital > 2019-02-26 10:39 | Report Abuse

Good acquisition or not,

Lets put it this way. The earnings from Auric is not even enough to cover the interest expense of the loan taken out to acquire it.

Unless Auric had a rubbish management previously, and DKSH will double the profits or smtg, i don't think its a good acq.

Posted by Choivo Capital > 2019-02-26 10:41 | Report Abuse

Instead of buying auric, with that amount, the owners can privatize DKSH with internal generated loan at half the valuation.

way better value imho.

Posted by chankp7010 > 2019-02-26 11:17 | Report Abuse

Look like someone knows even better than Board of Directors/Management of DKSH. The acquisition of Auric is profit enhancing for years to come. At the same time, helping DKSH to go further in expansion of business. Directors/Management believe they can generate better profit/income and cash flow than to service bank loans resulting from RM480 millions payout.

Posted by here > 2019-02-26 16:24 | Report Abuse

https://www.nst.com.my/business/2019/02/463021/dksh-shareholders-approved-buy-auric-pacific

Posted by CFTrader > 2019-02-26 17:50 | Report Abuse

oh wow, no VSS , planned to absorb everyone ... ermm...
Sifu-sifu sekalian, any view on these ?

Sincerely
CFTrader

Posted by Icon8888 > 2019-02-26 17:52 | Report Abuse

head count very small. 190 plus only

no VSS no big deal

Posted by CFTrader > 2019-02-26 17:55 | Report Abuse

This acquisition of Auric is an interesting proposal ... I should read more and study in-depth about DKSH ...
Thank you.

Posted by sapurakencana > 2019-02-26 20:02 | Report Abuse

Now everybody concern about loan 485 mil to acquire Auric Pacific,if from the holding company point of view,if this acquisition is worthy to growth their asia business,they dont mind to invest large amount at the right time(During recession).2.If we convert RM485mil into swiss dollar,it only 120mil.For holding company share price Swiss 72 dollar(RM300 per share),this capital expenses only 10 persent of its annual revenue. This happen to Digi when Digi Swiss (Holding) ciompany acquire majority share from Berjaya,less than 5 years ,the return is few 100% from the original investment. Reconsider before invest.take your own risk
28/01/2019 20:59

Posted by CFTrader > 2019-02-26 23:15 | Report Abuse

sapurakencana, we all know who is behind the scene of DKSH. But what is the relationship between P&L and the shareholder behind DKSH ?

What you trying to imply is waiting for the holding company to inject fund (via PP or whatsoever method) to pare down the debt ?

The fact is , acquisition is 485M, profit is 25M, and the entire acquisition will rely on borrowing...
That is some interesting acquisition method....

Sincerely
CFTrader

Posted by sapurakencana > 2019-02-27 00:01 | Report Abuse

CF TRADER,your focus point is on the acquisition price 485mil too high & profit per annum 25 mil too low.For FMCG business,it depend on the grow of the population & the increase of lower income to middle class income & the regconition of the product.My advise is for those who can hold at least 3 to 5 years.

Posted by villa1668 > 2019-02-28 06:40 | Report Abuse

Actually I don’t like the acquisition deal

Posted by francis188 > 2019-03-02 21:03 | Report Abuse

dividend is coming.....

Posted by Choivo Capital > 2019-03-09 00:50 | Report Abuse

Yes, i believe i know better. Would love to be proven wrong though.


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Posted by chankp7010 > Feb 26, 2019 11:17 AM | Report Abuse

Look like someone knows even better than Board of Directors/Management of DKSH. The acquisition of Auric is profit enhancing for years to come. At the same time, helping DKSH to go further in expansion of business. Directors/Management believe they can generate better profit/income and cash flow than to service bank loans resulting from RM480 millions payout

Posted by shpg22 > 2019-03-15 13:50 | Report Abuse

If the acquisition is approved, its gearing will jump from current 0.05x to 0.9x. That is a very high leverage for a trading company that has a razor thin profit margin. With its average 5 years Profit margin of just below 1%, it may experiencing wider and frequent swing between profit and loss going forward. Expect more volatility ahead.