 |
| Author | Post |
|---|
Moolah
Forum Whacko
| Joined: | Sun Jul 9th, 2006 |
| Location: | Moo Moo Land |
| Posts: | 12809 |
| Status: |
Offline
|
| Mana: |   |
|
Posting #1: Fri Jun 29th, 2007 02:17 |
|
Pretty impressive preformance!
Any1 into this stock?
--------------
VS Industry Bhd (6963.KU) - Malaysia
3rd quarter ended April 30:
Figures are in Ringgit (MYR).
2007 2006
Revenue MYR289,128,000 MYR180,946,000
Pretax Profit 20,925,000 8,474,000
Net Profit 17,703,000 7,741,000
Earnings Per Share 12.95 Sen 5.60 Sen
Dividend 4.50 Sen Omitted
9 months ended April 30:
Revenue 797,589,000 498,302,000
Pretax Profit 62,440,000 28,334,000
Net Profit 50,414,000 25,106,000
Earnings Per Share 36.71 Sen 18.07 Sen
Dividend 10.00 Sen 5.50 Sen |
VS Industry Q3 net profit sees hefty rise
June 29 2007
VS INDUSTRY Bhd's third quarter net profit more than doubled due to an increase in sales volume for the quarter.
The company, which is involved in the manufacture, assembly and sale of electrical and electronic products, registered a net profit of RM17.7 million for the financial period ended April 30 2007, compared with RM7.7 million the year before.
The company has declared a tax exempt special dividend of 4.5 sen for the quarter.
VS Industry is optimistic of achieving a new record high financially, for the current financial year, in view of the continued growth of its Malaysian operations. However, it did not say whether that refers to sales or net profit.
____________________
|
RR
Forum Addict
| Joined: | Sun Jun 1st, 2008 |
| Location: | |
| Posts: | 5 |
| Status: |
Offline
|
| Mana: | |
|
Posting #2: Mon Jun 2nd, 2008 00:08 |
|
http://ir.wallstraits.net/vs/page.php?id=corporate_info
some info on VSI. You can get almost all the info you need.
|
Moolah
Forum Whacko
| Joined: | Sun Jul 9th, 2006 |
| Location: | Moo Moo Land |
| Posts: | 12809 |
| Status: |
Offline
|
| Mana: | |
|
Posting #3: Mon Jun 2nd, 2008 01:51 |
|
Welcome RR,
VSind has been one of the much better performerss. It's earnings performance from 2005 (i would discount 2004 - cos that was a horrible year compared to 2003) to 2007. Three absolute fantastic years.
However, if you would note, 2008 earnings has been rather flat around 20-21 million. While it's still impressive when compared to fiscal 2007, the explosiveearnings growth isn't quite the same as before.
Now, the problem i had back and now is that I am biased against VS. 
Damn guilty as charged.
You see VSind biggest money maker is its vacuum cleaner venture with Dyson.
Ok here is dyson website, http://www.dyson.com/ it does have sales in many countries (funny - it has sales in Spore but not in Malaysia! How come? Made in JB - which is one of Dyson mega plants - but no sell in Msia meh? Msia no use this brand?)
Vacuum cleaner woh... how really big is this market for Dyson? And what vacuum cleaner do I use myself? No woh - I use karcher. ( http://www.karcher.com.my/my/Products/Private/Consumer_Indoor/Wet_and_dry_vacuum_cleaners.htm
)
So for me, the biggest stumbling block is that I am not convinced about the product. plus VS and Dyson is only just a business venture between these two.
How? What about you? Care to share your opinions?
____________________
|
Moolah
Forum Whacko
| Joined: | Sun Jul 9th, 2006 |
| Location: | Moo Moo Land |
| Posts: | 12809 |
| Status: |
Offline
|
| Mana: | |
|
Posting #4: Mon Jun 2nd, 2008 02:15 |
|
RR,
here's another concern. since vacuum cleaners are part of the consumer household product and since Dyson is an American brand, logical assumption would be the bulk of the products would be used by the American consumer. Now with all the issue in the US housing market and tons of observations made on the weaker than normal consumer market in the US currently, perhaps now could be a concern... yes?
____________________
|
RR
Forum Addict
| Joined: | Sun Jun 1st, 2008 |
| Location: | |
| Posts: | 5 |
| Status: |
Offline
|
| Mana: | |
|
Posting #5: Tue Jun 3rd, 2008 05:29 |
|
Dear Moola,
You may browse these webpage to get to know Dyson better.
1) http://findarticles.com/p/articles/mi_go1545/is_200412/ai_n9743754
-> Some comment made by Clare Mullin, global marketing director for Dyson. But it is just a short one, the rest of the article, you need to purchase it
2) http://news.bbc.co.uk/1/hi/business/3113002.stm
-> Some "feel" on how Dyson is doing.
3) http://www.vacuumwizard.com/dyson-vacuum-cleaners.html
-> a list of vacuum cleaners. Review by brands. (If you are interested to buy a new vacuum cleaner, you can do your research here by comparing the brand)
4) http://www.buzzle.com/articles/dyson-vacuum-cleaners.html
-> an article on the emergence of Dyson in the US market (but dated back to 2006)
Will share my thoughts on VSI when i have more time.
rgds,
RR
|
RR
Forum Addict
| Joined: | Sun Jun 1st, 2008 |
| Location: | |
| Posts: | 5 |
| Status: |
Offline
|
| Mana: | |
|
Posting #6: Tue Jun 3rd, 2008 05:30 |
|
Oh dear Moola,
btw, I believe Dyson is a UK brand, cause their founder is James Dyson (borned in UK). If i am not mistaken, they sold their 1st product in UK too.
rgds,
RR
|
Moolah
Forum Whacko
| Joined: | Sun Jul 9th, 2006 |
| Location: | Moo Moo Land |
| Posts: | 12809 |
| Status: |
Offline
|
| Mana: | |
|
Posting #7: Mon Jun 30th, 2008 09:41 |
|
RR,
Did you see VS results? Rather shockingly poor.
Any comments that you want to share?
____________________
|
RR
Forum Addict
| Joined: | Sun Jun 1st, 2008 |
| Location: | |
| Posts: | 5 |
| Status: |
Offline
|
| Mana: | |
|
Posting #8: Wed Jul 2nd, 2008 05:58 |
|
Dear Moola,
To be frank. I am not surprise with the 3Q poor result.
Quote from Mr. Gan "“The group also during this quarter began cultivating new customers, with whom we anticipate to grow alongside in the coming years,” he added in the statement.
The third quarter would be challenging, considering a decline in orders from a major customer in February and March, Gan told StarBiz over the phone from Singapore.
The customer saw the economic condition in the United States and Britain and took a cautious approach by adjusting its inventories, he added, stressing that the uncertainties could be for the short term, and that orders could pick up ."
MD. Mr Gan has actually said a few times that it will be a very challenging year ahead. With high crude oil, high inflation, consumer become very cautious.
Hence, i think VS is only able to end FY08 at around EPS 35 sen, compared to around EPS 39 sen in FY07, declining around 10 to 15% of net profit. Ouch!!
So, the question is, the reason for the poorer results, is it because there is a fundamental shift in VS itself, or is it because of the whole industry doing bad?
I believe is because the whole EMS industry. Not because of VS business/management deteriorating.
Short/mid term, this industry Electronic Manufacturing Service (EMS) will have a direct impact from global economy slowdown. When people stop buying new phone, new TV set, new high 5 set due to higher cost of living, company like VS will feel the pinch.
However, long term, I like VS
1) Relationship with Dyson.
2) Diverting "a little bit" into Coal mining & Plantation
3) VS chairman, Mr Beh, he started off as a technician and in early 80s and expand VS to what it is right now. If you ask those who knows Mr. Beh, they will say he is very ambitious. A man with vision and a man to respect. He is a true self-made man.
4) They are in the Top 50 EMS provider globally. Not some sort of Malaysia Kampung King.
5) If you compare their profit margin, ROE and so on, VS is better than his peer group in EMS. (you can refer to OSK report)
For Dyson, they are very focus in their sales and their R&D. They do what they do best by focusing in innovation and outsource the manufacturing section to VS and Meiban. This has created a unique relationship between Dyson and VS.
As I can see, people buy Dyson vacuum cleaner, because it is Dyson. It has become a well-known brand in many countries. Dyson has the power to command the price of their vacuum cleaner, they don't cut their price down to compete with other vacuum cleaners. They compete with their brand, their reputation and their innovation, NOT with the price. I think this is the competetive advantage of Dyson over other vacuum cleaners.
So is this competetive advantage of Dyson sustainable?? To be frank, I am not sure, cause nowadays human beings are really good in "COPYING" and selling it at a lower price.
However seeing Dyson command around 40% of US market and yet to penetrate to emerging countries such as Brazil, India, Vietnam, I see potential in them to grow their market share exponentially globally.
(Besides, you wil like Dyson, after you have read the success story of its founder, James Dyson, pretty inspiring)
I am optimistic that EMS sector will grow rapidly in the years to come with emerging new economy. Handphone, Laptop, Computer, TV, high 5, DVD recorder have become a NEED, the world needs it. Consumer like me will pay for it.
In conclusion, VS at around RM2.00 per share, which translate into around PE 6 for EPS 0.35 sen FY2008, P/BV of around 1.08, Cash per share around 26 sen, Dividend around 6%, with potential growth, management with integrity is it worth buying?
So how now?
-RR-
|
Moolah
Forum Whacko
| Joined: | Sun Jul 9th, 2006 |
| Location: | Moo Moo Land |
| Posts: | 12809 |
| Status: |
Offline
|
| Mana: | |
|
Posting #9: Wed Jul 2nd, 2008 06:09 |
|
RR,
Much risks i see.
2) Diverting "a little bit" into Coal mining & Plantation
I do not like diversification. IMO a company shud just stick to what it knows best.
3) VS chairman, Mr Beh, he started off as a technician and in early 80s and expand VS to what it is right now. If you ask those who knows Mr. Beh, they will say he is very ambitious. A man with vision and a man to respect. He is a true self-made man.
Hmm.. 80 years already? Old woh. Any succession plans?
4) They are in the Top 50 EMS provider globally. Not some sort of Malaysia Kampung King.
As it is - earnings was terrible. It matters not if they are TOP x percent.
5) If you compare their profit margin, ROE and so on, VS is better than his peer group in EMS. (you can refer to OSK report)
I believe you should also judge as it is. As it is, signs of weakness is so evident.
In conclusion, VS at around RM2.00 per share, which translate into around PE 6 for EPS 0.35 sen FY2008, P/BV of around 1.08, Cash per share around 26 sen, Dividend around 6%, with potential growth, management with integrity is it worth buying?
As it is, I would have to consider the impact of high crude on its products. If not mistaken, high oil should have a huge impact on its raw materials.
____________________
|
RR
Forum Addict
| Joined: | Sun Jun 1st, 2008 |
| Location: | |
| Posts: | 5 |
| Status: |
Offline
|
| Mana: | |
|
Posting #10: Wed Jul 2nd, 2008 07:54 |
|
Dear Moola,
2) Ya. It is true that with divertion into field that are not familiar, it is something risky. There have diverted into
a) Palm Oil
-VS have to finance a lot to acquire 27000 ha lands in Kalimantan (not sure about the exact figure they spent). The worst part is that, they will only start harvesting in year 2010.
-VS is bullish on CPO in the coming years.
=> To me, in time of economy slowdown like this, I think to finance the land, it is a burden to the group.
b) Coal Mining
- This is something that get earn them money RIGHT NOW. They have secured the contract with Indonesia power plant.
3) I mean Mr. Beh founded VS in the early 1980 at the age of around 20++ when he was a technician. Right now he is around 50 to 55 years old.
4) Earnings are bad not only for VS. Earnings are bad for the whole EMS industry. Being in the Top 50 EMS provider is nothing. But if you look it in another way, the ranking can tell you a little bit on how well VS is competing with its peer group.
5) Indeed, sign of weekness is in the whole EMS industry.
"As it is, I would have to consider the impact of high crude on its products. If not mistaken, high oil should have a huge impact on its raw materials."
Yup. Resin is the main operating cost. QoQ, operating profit margin falls from 7.8% (2007) to 6.2% (2008). But for its cumulative 9 months period ended April 2008. Its operating profit margin up from 7.8% (2007) to 8.5% (2008).
High crude oil will definitely have an impact to VS Operating profit margin.
High crude oil will also have an impact on consumer spending, where consumer will stop buying Vacuum cleaner, and start using a broom A change of lifestyle.
hoho
-RR-
|
Current time is 17:15 | |
|
|
|
|
