Posted by Dehcomic01 > 2024-01-08 11:05 | Report Abuse

Ever since coming across an article suggesting that the packaging sector would benefit from the growth of online retailing, I have been hunting for packing companies. My search went beyond Bursa and included US.
Why the US? In 2023, the total return (dividend + capital gain) for the Bursa KLCI was about 3%. The S&P 500 achieved 26%. Even accounting for forex losses, you can see why the US is better. But this does not mean buying blindly. You still need to do fundamental analysis. Take the example of Avery.
This is NYSE a global materials science and digital identification solutions company. Despite its acquisitions, its revenue only grew at 4.4% CAGR over the past 10 years. While ROE and net margins have been trending up, there were no improvements in other operating parameters, I think that the stock is fully priced. https://i.postimg.cc/C1cQgNs2/Avery-Dennison.png
On the other hand, Bursa Asia File has diversified into food packaging. Not exactly sexy, but it has a margin of safety. The only concern is how long it will take for the market to re-rate. If I can find an equivalent US packaging company, that would be priority. In the absence, Asia File is there. https://www.youtube.com/watch?v=CPtsfLAnaEc

Posted by paperplane > 3 weeks ago | Report Abuse

2/3 assets not earning anything and you still argue not a value trap? are you joking? Dividend so low even earning so much, the owner got bulk of shares and not willing to share good div with investors.

Posted by Dehcomic01 > 5 days ago | Report Abuse

We have read stories about how some of the Malaysian media groups “suddenly” have to close down their newspaper operations due digital disruption. Digital disruption does not happen overnight and you would have thought that companies would have years to prepare for this.
One good example of a company that took step to anticipate digital disruption is Asia File. This is a global filing company. We all know that digital technology is changing the way we store documents and the demand for files will continue to decline.
Asia File recognized this and for the past decade, it had stopped expanding its filing business. Instead it diversified into food and consumer wares about 7 years ago. This have given it a possible non-stationery growth path. But it is not clear whether this can be as big as the stationery business. So the company is still looking for other ventures.
This good story is that its stationery business is a cash cow and it is still not clear how long it will take for the demand for files to become negligible. In the meantime, the company is using the cash and time to build up replacement businesses.
I am sure you will not read any story about this company suddenly closing down the filing business due to digital disruption. If you want to know more about this, go to page 21 of INVEST https://notice.shareinvestor.com/email/newsletter/invest/pdf/Vol203-Invest-19Apr.pdf