Innature is set to resume its uptrend as it bounced off the 21 days to reclaim the area above the previous breakout level of RM0.61 and close at MYR0.595 on friday – supported by bullish momentum and volume.
The Body Shop products are 100% vegetarian which do not contain animal-derived ingredients whatsoever. We have been in Malaysia for 38 years, and our customers largely reflect the demographic of the country. In June 2022, we have been officially listed as a constituent of the FTSE4Good Bursa Malaysia Shariah (F4GBMS) Index that are Shariah-compliant. On the future of The Body Shop franchise, as aforementioned we have been working with the brand principal for almost 4 decades - a testament of the brand principal's confidence on us.
EASTSPRING INVESTMENTS BERHAD'S MANAGED FUNDS Prudential everyday buy... But share price still downward. Look like wan to push until RM0.20. Bagus sekali kalau dapat turun sampai harga itu....
These amazing fundamentals are currently being offered at a wonderful price of 11.6x normalized PE - with an estimated Margin of Safety of 50% from intrinsic value.
However, Branded Retail stands in stark contrast to its much more regular cousin - being one of the most attractive businesses to own from an investor’s perspective. Think about companies like Apple, Starbucks, Hermes, McDonald’s, Coca-Cola, Toyota - all of them are household names with prices far in excess of the market average.
This is because the value proposition that these businesses offer their customers goes far beyond the product alone - it extends to the attributes that the brand stands for, whether that is self-expression, environmentalism, social progressiveness, a commitment to quality… or all of the above. A much tortured analogy of this phenomenon is the infamous saying, “customers buy Tiffany’s for the box, not the jewelry”.
In that sense, a Brand represents the elemental human-to-human connection between the business owner and the customer - a social contract, if you will. This is quite clearly much more than just a product or service being sold - there is an intangible promise being exchanged, which theoretically has unlimited potential. And in our current capitalistic society with no faces, brands are the closest societal institution that we can associate with as being human today.
Just to drive the point home, think about what customers are really paying for when they patronize each of the aforementioned brands. McDonald’s is selling consistency, Starbucks is selling the Third Place, Apple is selling ‘technology that just works’, Hermes is selling self-expression, and Toyota is selling reliability. Notably, these aren’t burgers, coffee, smartphones, handbags or cars - they’re all attributes which we associate with human beings, closer in nature to the soul rather than goods grounded in the tangible world.
Maybank and now Public Bank both taken interest in InNature giving price targets. Shows that this stock will begin to get momentum.
Anyone that reads this and is looking for a well-managed retail stock with modern company principles can consider to do research and look into InNature. I am sure you will be impressed with what you see.
Every time I pass a body shop, I look in just to see. Always got people buying things. Never see staff standing around waiting for shoppers to come in.
The organic earnings growth inherent in pricing power makes businesses in the Branded Retail sector unique - and provides a strong competitive moat. This makes Innature paradoxically a high quality stock being offered at cigar butt prices - a wonderful business at a wonderful price.
Hence, this thesis boils down to simply waiting for valuations to revert to the mean (i.e. 60% upside at 25x FY19 when the next retail upcycle rolls along, while getting paid an above-average bond yield to wait. Why do I make reference to ‘bond yield’? Because their cash flows are highly robust and the company is in a net cash position, making their dividends bond-like. For the aforementioned low-risk and earnings visibility reasons, Branded Retail stocks tend to command relatively high valuations for the Retail sector of about 25-30x. For reference, the local Starbucks (Berjaya Food: 5196.KL) and 7-11 (SEM: 5250.KL) listed entities are currently (and have consistently) trading at 30x and 25x pre-covid earnings respectively, without any significant growth catalysts in sight.
Innature’s business motto is elegant in its simplicity - Business As A Force For Good. Innature has been pursuing ESG right from the start, long before it was cool.
Innature is one of the rare small-cap Malaysian listed companies which actually go out of their way to show that they care about Sustainability. ESG is the bridge between corporations and governments - where the societal role of corporations is to optimize scarce resources, while the societal role of government is to provide for indispensable social needs even if they may not necessarily be sustainable.
ESG tries to pull companies closer to the middle by enabling the sustainable provision of social needs, resurrecting the premise of the social contract - where the immense resources of the private sector are lent towards performing some of the heavy lifting in society. It also harkens back to the ancient days of old, before the corporations’ sole duty was purely in the service of maximizing shareholder returns. The investment thesis is simply that the current share price (RM 0.64) is trading at a discount to the value of the low-risk Malaysian operations alone - there are no valuation gymnastics to be performed here. Cash flow risk is lower than Gandhi’s ego, and being paid a normalized dividend yield of 4.5% while waiting for valuations to revert to mean at least offsets inflation. I am willing to stake my reputation on this company not going bankrupt.
Cannot just issue more shares? I mean I am no expert but if their share spread for public is below threshold why isn't it possible to just issue bonus shares for example?
Kayce is right. Bonus issue is back to square one. Cannot solve the float problem. Only private placement can do the trick, but at the disadvantages of the minor shareholders. Retailers will be getting a raw deal.
just listed recently want privatise already? what u smoking man? if u want privatisation candidates, here's the list: FACBIND, ICAP, INSAS, KSENG, MPHBCAP. all cash rich
@speakup, you have to understand that the major shareholder is holding close to 75% and Prudential has slightly more than 5%, leaving its float at less than 20%. Bursa has given it until 26 March to rectify the situation.
Cash per share is only 5sen/share, which represents 8% of the current share price. There is no reason for major shareholder to take private now. Maybe later in future, but not now. All the other privatization candidates I mentioned before, have cash per share at least 50%.
take KSeng for example: Net cash rm987mil is rm2.73/share, representing 77% of the share price! Icap for example: Net cash rm140mil is rm1/share, representing 50% of the share price! so easy for major shareholders to take private, as they can do a SCR
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....
Hafid
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Posted by Hafid > 2022-10-07 21:22 | Report Abuse
Innature is set to resume its uptrend as it bounced off the 21 days to reclaim the area above the previous breakout level of RM0.61 and close at MYR0.595 on friday – supported by bullish momentum and volume.