JUMBO GROUP LIMITED
42R.SI
JUMBO GROUP (JUMBO SP) - Looking Forward To FY16
VALUATION
Maintain BUY and target price of S$0.49.
- Our target price has an implied FY16F PE of 20.5x which is comparable to its regional peers such as Cafe De Coral and Breadtalk.
RESULTS
FY15 adjusted net profit comparable to FY14.
- Assuming the restructuring exercise had been completed at start of FY15, FY15 proforma profit to owners would have been S$13.1m, forming 103% of our full-year forecast. After excluding one-off IPO expenses, FY15 adjusted net profit will have been about S$14.0m and fairly comparable to FY14.
- We will like to highlight that following the restructuring exercise, future profit from fellow co-operative ventures and some non-controlling interests will be consolidated into profit attributable to owners (as the various stakeholders have swapped their interests for shares in Jumbo during the IPO)
INVESTMENT HIGHLIGHTS
Looking forward to FY16.
- Jumbo is expected to enjoy profit growth in FY16 driven by full-year contribution from its second outlet at Raffles City, Huang pu, Shanghai (which opened in Aug 15) and its third outlet at IFC mall, at Pu dong, Shanghai which will be opening in Jan 16.
- By the start of 2016, Jumbo will have three outlets in China, with total seating capacity of 600.
Cashflow generative business.
- To recall, while Jumbo may extend credit terms to corporate clients such as tour agencies, contributions from these clients form less than 1% of total sales.
- Cashflow generation continued to remain strong in FY15, as the group generated S$9.5m of free cash flow.
Andrew Chow CFA
UOB Kay Hian
|
Brandon Ng Chenhao CFA
UOB Kay Hian
|
http://research.uobkayhian.com/
2015-11-30
UOB Kay Hian
SGX Stock
Analyst Report
0.49
Same
0.49
