Koda - CGS-CIMB Research 2021-06-21: Original Design Furniture Manufacturer

KODA LTD (SGX:BJZ)

Koda - Original Design Furniture Manufacturer

Koda Ltd was founded in 1972 as a sole proprietorship. Today, Koda (SGX:BJZ) is listed on the Main Board of the SGX.
Management guides that Koda has seen higher demand for its products due to work-from-home arrangements to combat the spread of COVID-19.
Koda has been in a net cash position over the past five years and trades at a 1.4% discount to its end-Dec 20 book value per share of S$0.735.

Koda Ltd was founded in 1972 as a sole proprietorship operating out of a small workshop producing wooden cabinets. The group has since progressed to having factories in Malaysia and Vietnam and was listed on the SGX in 2002.
Today, Koda has an extensive range of offerings, including solid-wood dining, living room and bedroom furniture. It also has its own retail brand, Commune, which targets high-end customers with trendy designs and contemporary lifestyle furniture and accessories.
As of end-Jun 2020, Koda had 75 Commune outlets in Singapore, Malaysia, the Philippines, Hong Kong, China and Australia.

Established in 2011, Commune is a homegrown furniture design and lifestyle company that originated in Singapore. It has its own in-house design team and the products are manufactured at its own factories in Malaysia and Vietnam.
According to its website disclosure, Commune uses eco-conscious timber imported from different lighting conditions.

Koda’s 1HFY21 (Jul 2020 to Dec 2020) net profit of US$4.8m exceeded FY20’s net profit of US$4.3m. Management attributed the 1HFY21 performance to higher demand for the resurgence of COVID-19 infections and the US-China trade tensions.
Koda believes it can remain profitable in FY21F given the improving production efficiency and cost-cutting measures, as per FY20 results commentary.

See
Koda Ltd share price is trading at a 1.4% discount to its book value per share of S$0.735 as at end-Dec 20. Koda has also been in a net cash position over the past five years. Historical FY20 P/E is 10.3x while historical dividend yield is 1.72%.

William TNG CFA CGS-CIMB Research | https://www.cgs-cimb.com 2021-06-21

SGX Stock Analyst Report NOT RATED MAINTAIN NOT RATED 99998.000 SAME 99998.000