Y VENTURES GROUP LTD.
SGX:1F1
Y Ventures Group Ltd - Iron Man Action Figures Coming To YVEN’s Web Stores
- Y Ventures Group (YVEN) has inked a 3-year distribution agreement with Beast Kingdom Co., Ltd as its exclusive online distributor for Disney merchandise in Southeast Asia.
- YVEN will retail official Disney, Marvel, Star Wars and Pixar merchandise across online marketplaces in the region.
- Maintain ADD with Target Price of S$0.62, based on 30x CY19F P/E.
Online distributor for Disney merchandise in Southeast Asia
- Y Ventures (YVEN) has entered into a 3-year distribution agreement with Beast Kingdom Co., Ltd, a licensee for official Disney products in Asia.
- Apart from Beast Kingdom’s own online platforms, Beast Kingdom’s products will be exclusively available on YVEN’s online web stores and across online marketplaces in Southeast Asia.
- Beast Kingdom’s products include official Disney, Marvel, Star Wars and Pixar merchandise across various categories that include figurines, novelties and stationery.
- YVEN aims to become the largest online retailer of official Disney products in the region.
Tie-up proves YVEN’s analytic capabilities appeal to major brands
- This will add a line of official Disney merchandise to YVEN’s online product range, extending it beyond academic textbooks and private label products.
- YVEN will also provide data analytics to augment product selection, optimise online marketing and ensure end-to-end delivery and after-sales support.
- The tie-up with a major Disney licensee is a testament to the fact that YVEN’s data analytic capabilities can appeal to global consumer brands, and its ability to partner with them to expand sales of their merchandise across online marketplaces.
Positive impact on earnings with expanded product range
- Management does not expect any significant deviation from FY17 gross margin of c.41.6% from the future sales of Disney merchandise across online marketplaces in Southeast Asia.
- We estimate 40% gross margin for the group in our forecast period.
Maintain ADD with unchanged Target Price of S$0.62
- YVEN is currently trading at FY19F P/E of 21.2x, c.57% discount to global peers’ average of 49.1x.
- Re-rating catalysts could include the formation of more brand partnerships. Key risks include overstocking of inventories.
- We have an ADD call on YVEN with a Target Price of S$0.62, based on 30x CY19F P/E, representing a 39% discount to global peers’ average.
Colin TAN CFA
CGS-CIMB Research
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https://research.itradecimb.com/
2018-06-27
SGX Stock
Analyst Report
0.620
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