With the festive Lunar New Year fast approaching, for many wedded couples, the time of the year to give out ANG BAO money is also close. For some, it can be a “headache” to fork out a few thousand dollars for the occasion. Fortunately, there is the stock market that allows us to make up the shortfall.
Investors Takeaway: 4 Stocks To Help You Fork Out Ang Bao Money
- Tianjin Zhongxin Pharmaceutical Group Corporation (Tianjin Zhongxin)
Tianjin Zhongxin has been a sleeping giant for years. However, Tianjin Zhongxin’s new chairman has promised to put its resources to full use moving forward. The new management has a 2020 strategic plan to double internal drug manufacturing profits in three years.
The new management has turned its focus to growing its core products while leveraging its existing expertise to expand into complementary new businesses that will generate new growth. They have already consolidated its overlapping business departments to achieve operational efficiency.
Tianjin Zhongxin’s management also acknowledged that the company has been underutilising its financial resources. To better utilise its cash hoard, one likely solution will be earnings accretive/strategic M&As.
BUY, TP US$1.52 (current share price: US$0.935)
Since its listing last year, Kimly has fallen from its peak by nearly 30 percent. UOBKH recommends Kimly as a stock with a strong cash position and clean balance sheet. Its cash generation capabilities, clean balance sheet as well as earnings resilience helped Kimly record a strong bash balance of $0.07 per share. Its strong war chest of $83.7 million cash provides opportunities for the group to grow its business vertically or horizontally through acquisitions.
Against a backdrop of online food delivery players, delivery services can give Kimly an additional avenue to sell its products. Kimly has already started to partner Ubereats, Deliveroo and Foodpanda for its dim sum and zichar businesses, which can contribute $60,000 per month.
Kimly is currently trading at 18 times forecast-FY18 earnings, which is a 13.5 percent discount to consumer peers.
BUY, TP $0.45 (current share price: $0.35)
- Roxy-Pacific Holdings (Roxy)
Roxy is one of the few “undiscovered” mid-cap developer proxies to ride the recovery of the Singapore property market. While the rest of the property developers are busy landbanking, Roxy is already preparing to launch new residential development to consumers.
As one of the earliest to begin landbanking in the current market cycle, Roxy has seven freehold residential developments in Singapore. These seven freehold residential developments are ready to be launched in 2018, which is a good window to capture the rise in buyer demand before its peers. The residential units can potentially generate more than $500 million of total gross development value, i.e. 50 percent of its FY16 revenue.
BUY, TP $0.69 (current share price: $0.555)
- Jumbo Group
Jumbo has gained a foothold in China with its consistent quality. Jumbo continues to add a new outlet a year in China to expand its foothold. Jumbo is also aiming to expand outside of China through franchises and JVs to harness the strength of its value-adding partners and reduce upfront costs. Leveraging on its reputation and consistent quality, JUMBO aims to open 4-5 new outlets a year in between FY18 to FY20.
Right now, Jumbo trades at 21 times forecast-FY18 earnings per share. This represents a discount to regional peers’ 26 times despite its superior return-on-equity and margins. Thus, MBKE has resumed coverage of Jumbo with a contrarian BUY call.
BUY, TP $0.70 (current share price: $0.57)
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